Construction Management and Planning PDF

CONSTRUCTION MANAGEMENT
AND PLANNING
CONSTRUCTlOlv
MANAGEMENT AND
PLI dlN(
er Sengup
Professor of Civil Engineeri
Jadavpur Univers
Director, ACFA'= r-7sultant Pvt. Limit'ed
Calcultta
H Guha
Ex-Faculty, Jadavpur University
Director, Mas Construction Pvt. Limited
--
Calcutta
Tata McGraw-Hill Publishing Company Limited

VEW DELHI
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I,.,. T.
IUIUI
Graw-lYill
Tata MCC S:
A Division of The McGraw-Hill Companies
9 9 5 , Tata ishing Cotnpany L'ir
Six1th reprint 2002

RDI)BCRQAR(C A X L
is publicaltion can be reprodulced in an)r form or by any ml

rior writte n permission'of tile publisher S
Thits edition (:an be exr)orted frotn India 01ily by the publisher

Tat:a McGraw,-Hill Publlishing CoImpany Li mited
Pubdished by Tata McGraw-Hill Publishing : Compan:y Limited,

7 \nJest Patel Nagar. New Delhi 110 008, typeset at
Urv.ashi Press:, Vaidwara, Meerut 250 001 and printed at
c D ,D";..+a-L. E-120 Sector 7, Noida (U.P.) 201 3.01.
Dedicated in rnernorj
Dr Santimay Chak
'Civil Ehgineer;ing,
ye (Deenzed ~ nuersity),
i
Yowrah,, West E
This book is aimec
-
engineer
".
professicmals working
I the construction industry. stuaents of architecture and civil engineering
iploma courses and AMIE will also find the book quite useful.
The book gives the readers a working knowledge of the subject, rather
than providing any detailed insight into it. It contains a total of 19 chapters
which carry a wide-ranging discussion of construction management issues-
from statistics to law and accounts. This interdisciplinary stud) of construc-
tion management is important because decisions taken in practice are based
on the integral effects of all these factors.
The first four chapters describe the construction industry as a whole and
its various units. Elementary topics like definitions, organisational structure
and working methods have been covered. Chapter 5 introduces statistics and
illustrates with examples its usefulness in construction management. The
lethods and machineries for different types of construction like earthwork
nd concrete have been taken up in chapters six and seven. Chapter eight
eals with scheduling and describes standard methods like PERT and CPM
along with advanced techniques to study time-cost relationships and uncer-
tainty. Chapter nine pertains to various operation research techniques like
linear programming, queuing and simulation that are useful in construction
tanagement problems. Various management-related issues like quality,
dety, inventory, accounts, cost control, and finance are discussed in Chap-
:rs 10 to 14. Chapters 15 and 16 present the commercial and industrial laws
?lated to construction. Chapter 17 is a case study showing the analysis of a
mder bid. The applications of computers are discussed in Chapter 18 and
Ie last chapter draws the attention of the readers to the latest research in
Ie field of construction management.
In some chapters, like Chapters 8 afid 18,, referenc:es have been made to
-xnmercially available computer softwares mar ., , can be used to assist in
construction management. A number of computer softwares, that are similar
in logic but are sometimes restricted in their scope and conditions for use
and are termed as 'Shareware', are available in the market at very low prices.
Readers desiring to acquire shareware programs in construction manage-
ment may write to Himadri Guha, 78 Kiron Shankar Roy Road, 5th Floor,
viii Pn
Calcutta-700 001, with a self-addr imped er 'or a list of such

softwares.
We wish to express our appreciation to all those who have helped us in
writing this book. We also wish to thank our ex-students Mr Arup Chatterjee
and Mr Supriya Chandra. for their help in software applications. We thank
Mr Chi.tta Ranjan Dutta for his effort in the manluscript. We are
grateful to Tata McGraw-Hill Pul3lishing I y Limitec for exF)editing
., p u ~ l i s h h gof this boo^. Last, out certainly nor the least, -we
me 1 T . - I 1 .- -.. ... 3
-3-
are maemeu -3
L
to our fiamilies fc3r their cor, ;tart tmcourag rt the shaping of

this pro:ject.
MADRI G UHA
ATISH SEI
UGUPTA
This BOO
ew years back, a senior executive of Ta Publishi

Conqpany Limited re?quested vrite a book on advancec1 structural
desi gn. I had a conisiderablt ?rice in teaching this sul~ject w hich~
hap.pens to be my fa7~ouritea hpted his proposa1. At that time I h ad
undertaken to teach a course on Construction Management and Planning.
So I requested him to prescrible a list of books on the subject. Unfortunately,
I
1 . 1
there was no book wnicn covered all the topics and he asked me to write a
boo:k on that subject also. I did not diare comment as I had not had much
exptxience in te3clung it. In:stead I thought it over and realized that to
single-handedly write a book on a subject which covers such a vast range
of topics would be difficult. So I approached Dr. Himadri Gu ha, my 6?X-
colleague, who had taught Construction Management for a long tinne.
Without his efforts, this book would never have been published.
I am very much indebted tc) my stucients for the intert2st they 1lave s h ovn~
in this subject. The questions tlley have asked hewe led me to view the subjcect
from new angles- altogether.
-
uggestio~ 3s for im]provement from f he readex.s will be ex tremely welconle.
111be ver:y gratefultoanyre-aderwk10 points out any jnadvertctnt mistalke.
Preface
The Construction Industry 1

Types of Construction-Public and Private 2
Construction Practice: The Owner, the Consultal~ tthe
. Cointractor, t:heir
Duties and Responsibilities 2
Finand;lg Requirements 6
Regulating Requirements 6
Construction and National Developme
Features of Construction Economy 9
IRole of CcInstruction Management 11
1Exercises 12
2. CONTRACT MANAGEMENT
Contracts 13
o ~7-.7
Construction by Direct L a b ir
"ntract Documents 18
lalling Tenders 20
Scrutinising and Comparing Tenders 21
Choosing a Tender 22
Opening a Tender 23
Acceptance of a Tender 24
Risk Allocation 24
Security Bond 26
Contractual Changes and Termination of Contract
Subcontract 28
Rights of the Subcontractors 28
Duties of the Subcontractor. 29
Marketing 29
Public Relations and Advertising 31
International Market 32 ,
Exercises 33
3. DETAILS OF CONSTRUCTION ?r;
Introduction 35
Estimates 36
Rate Analysis 40
Codes and Standards 44
Exercises 46
4. CONSTRUCTION ORGANISATION AND SUPERINTENDENCE 47
Organisation Planning and Organisation Chart 47
Decentralisation 49
Construction Supervision and Superintendence 50
Detailed Superintendence 51
Hiring and Discharging of Personnel and Related Matters 5
Payrolls and Records 52
Purchase and Delivery of Construction Materials and Equipment 52
Records of Cost and Payment 53
Percentage Completion Report 54
Insurance Record 54
Project Office Requirement 54
Safety 56
Changes in Contract 56
Disputes and Stoppages 56
Organisation Chart of a Small Construction Company 58
Organisation Chart of a Medium Construction Company 59
Organisation Chart of a Large Construction Compa
Exercises 61
5. OPERATION ANALYSIS AND STATISTICS 62
Introduction 62
Distribution 63
Sampling 67
Regression and Correlation 71
Forecasting 74
Decision Theorv 76
Replacement Decision Tree 76
Motion and Studies 78
Activity Sampling 79
Multiple Activity Chart 81
Exercises 83
6. CONSTRUCTION PRACTICE I
Earth Work and Excavation 86
I Earth Moving and Excavating Machinery 88
xii Contents
Tunnelling 101
Exercises 107
7. CONSTRUCTION PRACTICE 11: SUPEI CTURE

Introduction 109
Cement 110
Aggregates 113
Water 115
Admixtures 116
Concrete 117
Reinforcing Steel 127
Form Work 128
Scaffolding 135
Brick Masonry 137
Structural Steel 139
Welding 140
Exercises 141
8. TIMES MAINALEMLN1 A N U XHLL)ULING

I
I
Introduction 143
Bar Chart 144
Critical Path Method (CPM) 154
PERT 161
Resource Constraints 165
v. ..
1 ime Cost Trade Off l E n
Uncebrtain Durations 1 ;
Progress Report 178
-..-.puter Applications 185
Cnm
Extwises 184
9. QIJANTITATIVE MA NAGEM 'ONS

Introduction :288
Linear Prograrnming 1,
Queuing Concept and P
Simulation 2C
Bidding Mode
Game Theory
Exercises 207
10. QUALITY MANAGEMENT AND SAFETY
Introduction 210
Quality Control by Stati:stical Methods 211
. .
Sampling Plan 213
Control Charts ---37.1
y Aspect I3f Constn
y Requirements 22
Safc
ExeICLDL-D LLr
References 224
RESOURCE MANAGEMENT AND I:

Introduction 225
Basic Concepts 225
Labour Requirements 227
Labour Productivity 229
Site Productivity 229
Non-prodcctive Acitivities 229
Equipment Management 230
Material Management 231
Inventory Control 232
Exercises 245
References 246
ACCOUNTS MANAGEMENT
Intrjoduction 247
Basi.c Concepts 248
Acoounting System and Bookkeeping 251
D ~Ireciation
P 253
Balalnce Sheet 256
.,.it and Loss Statemr
Pvn4
Ratio Analysis 257

Du Pont System for Appraising 263
Internal Auditing 264
"-'utory
31arl Audit 265
Tax:ition 266
Exerrises 269
13. CO!ST MANAGEMENT

Intrc>duction 273
pro; iuction Function 273
Ordler of Magnitude 2:
Unit: Cost for the Bill ol 2s 275
Con trol Estimates 276
direct Costs 276
mtingency 279
)st-Volume Relationship 279
Cost Control System 2Q7
cost.Codes 285
Spec:ial Aspects of Equipment CE
D..1
uuuiget 287
Acti.vity Cost Control ;
Forecasting of Costs 21
xiv Contents'
Cash Flow Control 289

. Fund Flow 292
Exercises 299
References 305
14. FINANCIAL MANAGEMENT
Introduction 306
Concept of Valuation 306
Net Present Value (NPV) Method 306
' Internal Rate of Return (IRR) Method 307
Difference between IRR and NPV 308
Evaluation of a Risky Investment 308
Required Rates of Return 311
Cost of Debt 312
Cost of Equity Capital 312
Cost of Preference Shares and Bonds 313
Cost of Retained Earning 314
Weighted-Average Cost of Capital 315
Working Capital 315
Management of Cash 318
Synchronisation of Cash Flows 318
Stochastic Model 319
Financing Working Capital 320
Modes of Securing Risk 322
Intermediate Term Financing 323
, Financing Non Profit and Public Sector Project 32(
Exercises 337
15. CONTRACT AND RELEVANT COMMERCIAL LAW?
Introduction 341
1 Laws of Contract 341
Definition of Contract 342
Elements of Contract 342
Contract Conditions 348
Sales of Goods 355
Distinction between Sale and Agreement to Sale 356
.Transactions other than Sale 356
Goods 357
Destruction of the Goods 357
Price 358
Implied Conditions of Sale 358
Conditions as to the Merchantability 358
Laws of Insurance 359
Types of Insurance 359
Characteristics of Insurance Contracts 3.1
Arbitration 362
Modes of Arbitration 362
Implied Condition of an Arbitration 363
Duties of the Arbitrator or Umpire 363
Revocation of Arbitrator's Authority 364
Award 364
Income Tax 364
Transfer of Property Act 367
Sale 367
Mortgage 367
Charge 368
Lease 368
Exchange 369
Gift 369
Sales Tax on Works-Contracts 369
Exercises 371
References 373
16. RELEVANT LABOUR AND INDUSTRIAL LAW>
Introduction 374
Payment of Wages Act, 1936 374
Contract Labour (Regulation and Abolition) Act, 1970 375
Minimum Wages Act, 1948 377
Employees' State Insurance Act, 1948 379
Workmen's Compensation Act, 1923 381 '
Payment of Bonus Act, 1965 383

Employees' Provident Fund (and MiscellaneaIUS Provis
Act), 1952 384
Payment of Gratuity Act, 1972 386
Factories Act, 1948 387
Trade Union Act, 1926 389
Industrial Disputes Act, 1947 390
Exercises 392
17. CASE STUDY

Introduction 394
Tender Document 394
Coventional Quotation 395
Analysis of Work Programme 395
Analysis of the Work Programme and Site Planning 411
Optimisation of Time and Cost Trade-Off 413
Simulation Mode!1 to Asses;s Risk of Meeting Deladlines 418
18. INFORMATIOIV MANLIGEMENT AND COMPUTERS
Introduction 421
Information Types and Usc
Computers 423
xvi Contents
Database and ns
Softwares 424
General Application Programs $LO
Civil Engineering Programs 429
Project Management Programs 430
Advanced Co truction Engineering Programs 431
Construction Management Programs
Expert Systems for Construction 440
Computer Aided Training (CAT) 441
References 444
19. SELECTED RESEARCH TOPICS nV CONS

MANAGEMENT
Introduction 445
Bidding Models 446
Uncertainty of Scheduling 449
Resource Optimisatia 454
Aggregate Blending 454
Construction Haul Roads 456
Minimum Time 457
3ptimum Number of Crews 458
Financial Management 460
jReferences 463
.Ann J Areas under the Normal Curb, ucLvvccll LclL lland Tail.
to Pmy Point Right of Mean
I: X Ti3bles of $Students
-. . -
. I : The Chi-Square .
.;L..+;-.. tk U 1 v c
DistTlvurlvlL
App. IV: Probability of Zero Units in tlle Systen
App. V: Control Chart Constants
App. VI: Master Format Code!3
App. VII: Secondary Divisions in Maste,r Formal: for Site Work
~ n n u i t yof Re.1-
.. A ..
App. VIII: The Present Value of an
App. IX: The Present Value of
Bibliography
Index
I CHAPTER I I
Introduction
THE CONSTRUCTION INDUSTRY
The construction i y is one of the oldest and largest industries.

Construction activity puvides employment on a large scale. The ur- -'
>e Ul
machines and equipment, which have become part and parcel of construc :tion
in modern times, has not only reduced the time of construction and nu1nber
of people engaged in construction but also improved the quality of consrrm-
L-_ -
tion and materials. The construction of high rise buildings, dams and
barrages, metro rail, cable stayed bridge, high chimneys, etc. are now
undertaken easily because of the availability of equipment and machines. In
most of the developed countries, scientific tools such as construction
management techniques are used, while in developing countries very little
modemisation has taken place in this industry. These countries still continue
with the traditional labour-intensive style of c:onstruct~
ion which is time-con-
suming and does not match quality requireme?ntsdemimded in construction.
... .
If construction project schedules are not mamtmecl, the cost increases by
leaps and bounds. While it is true that in the third world countries with a
high population, it is not appropriate to opt for complete mechanisation of
construction, it must be realised that the use of plants and machinery
sometimes becomes absolutely necessary for certain types of construction
and to ensure good quality. Therefolp, no politics with labour unions or
otherwise should be allowed to cause any delay and stoppage of work u
the pretext of loss of employment due to the use of machines.
Thus, the use of plants and machinery and the adoption of the 1
construction management methods should be the essentia 1 feature
construction industries in modem times.
2 Construction Management and F.-. .....,.
TYPES OF CONSTRUCTION-PUBLIC AND PF
&nstruction projects are carried out by the public sector or the Gov
and also by the private sector. The projects undertaken by the gov
are much bigger and involve large outlays. These are of national importance
and meant to direct the overall econodic development of the country. For
example, a river valley project involvind the construction of dams, barrages,
irrigation and navigation canals, aquid&ctsand generation of hydro-electric
power is a huge project which takes a lAng time to complete and requires a
large sum o w n e y . The construction of steel plants, power plants, national
highways, interstate roads, long span bridges, etc. are of similar nature. The
development of neighbourhoods under urban renewal schemes, big housing
projects or establishing new towns are also generally carried out by the
Government. Many of these projects are specialised in nature and hence need
specialist contractors. For the execution bf these projects generally only a few
select the appropriate contractors. $

construction companies are available. obal tenders are floated in order to
hen jobs are awarded to these
specialised companies, the project invdriably runs smoothly. The money is
provided from the allocated funds wdich may or may not be fully ready
before the work is undertaken. Monev mav also be raised from foreim " aid
agencies. If there is a dearth of f 'unds or any une:cpected (lelay in :releasing
funds, the project may suffer. 01 I the 0ther hand, there arc many nlore jobs
-LA--LL- --l--L-- - - L
which are not of specialised nature ~- - AI I U-. .-A
~ 1C
W I I ~ I CU L V b e l e ~ ~ 1 UI
.--L--- :-
---I..
1u I l L l a L L u I > 13
based on quot ations "percentage lo*ei r than tlhe schedluled prjice" and
thougk1 not obligatory tl-le job gerlerally gc)es to the lowest b idder. Sometimes
. .,-
1
-: . . ~
the rates. quoted 1
are really unworkable. Unaer -1 ...
.
tne. circumsrances
11.
the. : jvvs
A
... -I--8
dre
bound to suffer. It is f elt that there hc a changt ook and
proced.ure so tllat the q uality of work dc)es not f: 111below d. Some-
times quorarlons are also .mvlrea
~ c - , . . . on the' basis . or percenrage
1 - C I,
nigner rnan .
11 - .
me 11.
scheduled price".
In the private sector, the job is normalljI underta.ken only when the money
is ready and there are no quotations based on "percentage
. .
- less than the
scheduled pricc!". The r:~ t e quot
s ed are w orkable imd once started ithese are
normally finished on tirne.
Whether the ,.,-...*
culLllllY
-.?;I1
YVlll
4
tjV " cV
. ~ ~ l.;**-
7
ULULEj
m*..h
yuVllC
.,at;rs,;r\.
,-.W
will be
n..;
,,L~V U L L D U L ~ U ~
1
VIL
encouraged is a matter of policy of the ruling gcwernmerit and this policy

may change at different times with difkerent peop le at the helm of affairs.
I
CO,NSTRUCTI( THE b~INER,
THE CONSUL^ rRACTOR,
THEIR DUTIES AND RESPONSIBILITIE
Civil engineering construction needs the

materials. The construction industry is one of the most import;mt indus
which provides jobs to a very large number of labourers, techniclanS,
engineers and technologists throughout the country. Before the comrntmce-
ment of any construction project, it is required to know the purpose of the
project, design all the structural elements including the superstructure and
8
the substructure well ahead of the beginning of the construction, and pre!pare
the detailed drawings according to which the construction will proceedI. On
. -
the completion of construction, it is required to check the working of the
elements of construction and installations before the project is commissioned.
All these activities may last for quite a good number of years depending
on the size of the project. It may need thousands of hands, the experience of
generations of experts and the use of natural and manufactured produc:ts of
different trades and occupations. During the period of design imd construc-
tion, it is of utmost importance that the flow of money be smooth so that the
job may proceed unhindered and the supply of materials of construction and
labour also follow the schedule of construction.
7'he kejr person!;responsible for the succcessful i~nplemenltation of the
project are the owner, the ccmsultant and the contract1or.
The Owner
The owner or the I decides to unde~
.:take the work af ter a dc?tailed
. .. . . d
analysis of the costs and the payment schedule for me project. rhe p a y e n + L %LA. L
to be made by the owner has to be regular and in line with the progress of
the work. To maintain the flow of money the owner may utilise his own
resources or borrow money from other sources. The money arranged and
spent for the job is known as the "capital investment". The owner must have
absolute faith on his expert advisers regarding the surety of performance of
the project and the estimated cost required for its completion. The owner is
generally expected to arrarlge for t:he suppl ver and water tc the
construction site.
The owner may ut: a yersult o r a group of yersurls acting as a corporate
V
body such as a local government authority or a gove!rnment clepartrnent, a

company, a corporation or joint board or any other authorit:y possessing
adeauate c --.----
The consultant/engineer or architect is a person or a group of persons or a

company who gives the owner the technical advice for the project. The
primary function of the engineer is to design, do the necessary research work
for the design, provide the calculation for the cost, appraise the owner about
the pros and cons of the project and impress the owner in a manner that the
owner can rely on him regarding all technicalities of the project so as to
4 Construction Management and Planning
develop full confidence on him. He must be well-trained in quality and

workmanship requirements, and must supervise the construction daily or
periodically as the case may be. In respect of all the duties and related
technical matters the engineers must exercise a realistic, thoroughly profes-
sional and entirely independent judgement.
An owner or a promoter may engage a consultant for the job in one of the
following ways:
1. He may engage a single consultant for the entire job.
2. He may engage one competent engineer from his own employment

to do the job. Many local authorities and government departments
employ their chief engineer as the consultant particularly for
specialised jobs like bridges and tunnels where they have got their
own expertise and the chief engineer gets the design work done by
his junior engineers under his own guidance.
3. He may engage a consultant for a portion of the job in which his own
men are not expert but the remaining portion may be awarded to his
own men, e.g., in a building project he may get the architecturaldesign
from an architect consultant but the structural design may be done by
his own engineers. This is quite common when the owner is a
government department or agency.
The payment made by the owner to the consultant is known as the
"consultancy fees". This may vary depending on the volume of work to be
done and whether daily or periodic supervision is to be carried out by the
consultant. In case, the owner or promoter decides to employ his chief
engineer as the consultant engineer then the chief engineer enjoys all the
powers of a consultant for design and also works as an administrator for the
construction.
A consultant is generally employed because he has every fre
exercise his knowledge and experience for the new design and ~ ~ ~ ~ L L U L L L U L L .
He could give ample thought to the project problem as this is his main job,
work out the various alternatives based on his knowledge and experience
and could finally select the one which has the most suitable form considering
feasibility and economy. He has to keep abreast of the new materials and
products available in the market. In addition a number of different problems
are tackled by a consultant which is substantially more compared to that of
a chief engineer in a government department who has specialised in
problems of design and construction of his own department and may not
be as good as the consultant for other problems. Thus employment of
a consultant may be essential in some cases while it may be optional in
others.
Introductii
The Contractor
A civil engineering contractor is a person, or a group of persons or a company
who undertakes the construction. He offers to do the job for a given suIm of
money and in case the tender is accepted he signs a contract with the o1wner
or promoter to undertake the construction. He must have the skill a-..A1 IU
competence to execute the work exactly as the owner wants and the engineer
advises. He is to do the construction work as per the drawings, specifications
and instructions issued to him by the engineer and as per the details r-..*--
;1vn1
in the contract signed by him.

For the construction work, the owner has got several choices for selecting
contractors:
1. the whole job may be awarded to a construction company, or
2. if the promoter is a government department having a full-flecltjFu
maintenance wing, the new construction could also be entrusted with
the maintenance division depending on the size of the new construc-
tion and the supervision of construction could be done bv the
departmental engineer in addition to the design work.
Sometimes the promoter may employ the contractor to do bc~ t theh dt
and the construction on contract. This arrangement is known as the "package
deal" or "turn key".
The owner is supposed to reimburse the cost of construction to the
contractor as per the advice of the consultant and there shou Id not be! any
dispute.
The arrangement that is made between the owner, consultant ana contrac-
tor should be such that there is no chance of misunderstanding annong
themselves and every effort is given by these three parties for the grand
success of the project.
There is no direct contract between the engineer and the contractor. The
engineer has no power to accept or reject a tender. The engineer calls upon
construction firms to tender. After receiving the tenders or quotations he is
to refer them to the employer and seek the employer's acceptance. But the
engineer has to guide and advise the employer to select the tenderer. In order
to make the contract binding between the owner and the contractor, an
agreement has to be signed between the two parties. This document is
normally sealed in case of government or quasi-government departments.
For sanctioning any extra work to the contractor for genuine reasons, the
owner is to be consulted first. The contract may have the provision for a
"provisional sum" and provision for contingencies which act as buffers for
accommodating extra work to be done which are not included in the tender
document. For example, local weakness or character of the soil exposed after
excavation may call upon changes in the size or the type of foundation wrhich
may involve extra cost. This extra cost is made available from the above sums
of money. But changes in specification in the items of work should not be
encouraged, e.g. white wash on walls !should nlot be cl-langed into lime
punning, or plaster of paris finish of wall! or Indiam patent stone should not
... - -..
. I - . ..
be changed to marble floor. In case sitnilar
-
--:I-..
- -.
-- - cnanges are required, prior
permission from the owner sholuld be o'btained ;md the Iowner st~ouldbe
informed about the financial invc~lvementfor the specified Izhange b~ efore the
item is actually undertaken.
Similarly, there may be inadvertent omission c)f imporitant thin:gs while
the tender was prepared, e.g. the consultant might have thought of using
cranes, hoists, etc. during construction but while preparing the tenders these
may not have been mentioned. Under these circumstances, the permission
as well as the sanction of the owner are necessary before the equipment is
actually used at site.
FINANCE REQUIREMENTS
Financt2 is the rnost important r e s u u l and
~ ~ it is generally in short: supply.
Hence proper a nd efficient utilisation of finance is very importan1t, parti-
cularly in the context of an ever increasing price. Financial accountatdity has
to be built into the performance and appraisal system fol: maximising the
efficiency at minimum cost. All short term and long tern1 capital require-
ments have to be planned and arranged at a proper time inI order tcI run the
project:; smootl~ly.Financial institutions are to be approached and the
required cash flc~w is to be drawn. Advances and dues should be realised in
due tinle and a11 efforts should be made to keep the interest element to the
barest minimum. A good knowledge of acc and taxa tion is al:
necessary for the construction compar transactir~g the 1
economically and efficiently.
REGUL
Like otllr~~ u > ~ l ~ tdcuvities,
.ss the construcc~vr~
worn also operates wlaer
government rules and regulations. Most of these legislations and rules are in
force to protect public safety and welfare. Such regulations and rules were
evolved decades ago and have become quite complicated and even con-
tradictory in several instances. A construction manager is required ct 9 have a
knowledge of the rules and regulations applicable to his problem in order to
prepare an action plan. In addition, advice from experts is essential .. .m .
complex situations. A construction manager unless cauti~ ous C O U d
~ ' easily
commit legal misconducts inviting intervention from regulatory iagencies
causing delay, financial and other losses.
Law!j and re1gulations, that affect the construction work can be
dividedI into sev.era1categories and is presented in Fig. 1.1.
Introduction 7
I Regulations
General laws/regulations Specific
I
affecting construction
Labour and Financial Commercial

welfare laws and taxes and contracts
I I
Util specif/cation Environmental Construction
rull and codes and pollution and building
rules
Fig. 1.1 Catec
une may notice trom the chart that all aspects such as material, labour
and financial matters of a construction projec3 are req uired to ed in
accordance with the regulations.
In advanced countries, regulations for environmental polluhon and
occupational safety' are very stringent and many of the large projects like the
construction of a IJower pl ant is primarily dependent upon the clearance
from these considerations. Even in India, river valley projects have been
abandoned due to environmental considerations. There are a number of
government departments and public agencies to implement and monitor the
regulations. Each of the dey s has franed rules like the maintenance
of account books by the ( ion manager. Tn addition, monthly or
quarterly returns filled in p 1 forms 2ire requiired to be submitted in
the respecitive depz
In shorit, govern gulations have a sable imy>actup01n the
constructic>nmanaljell Jecisions and the ILL^ Lasrl is requi~red to re: ILL :-
UL .-I.
- --- - .--
.-
an effective LILdIUIe r to ovevcome problems related to public regulations.
CONSTRUCTION ,AND NA
Construction, devehlopment of infrastructures and economic progress are
almost inseparable. 'Particularly, for a developing country like India, con-
struction work accc~ u n t sfor a large share of government development plan
outlay. In some in:;tances,, it may even exceced the h,alf of the government
development budgc2t. For (?xample,the outlay.sfor construction in the India's
five year plans are presen ted in Table 1.1
Table 1.1 Construction share of five year plans

Percentage of total
Plan
development budget
First Plan (1951-56) 50.4
Second Plan (1956-61) 42.6
Third Plan (1961-66) 42.3
Fourth Plan (1969-74) ' 43.2
Fifth Plan (1974-79) 43.4
Sixth Plan (1980-85) 36.2
Seventh Plan (1985-90) 40.0
Even with this emphasis in national planning, construction requires more

funds than allocated for adequate development of the infrastructure and
housing. The contribution of construction to gross national product (GNP)
in India is about 5-6 per cent. In other developing countries, particularly in
the middle east, the percentage is much higher. In a developed country like
the United States, the value of new construction contributes about 10 per
cent to GNP. In absolute monetary terms, the investment in construction in
India, say in 1979-80, was about 1,760 crore rupees (i.e. Rs 1.76 x 10'') and
in United States for the same period it was about US $ 300 billion (i.e.
Rs 3.9 x 1012 approximately). In other words, the investment in absolute
monetary units in construction in a year in US is more than 200 times than
that of India.
An important feature in the construction industry is its multiplier role to
the national economy. It is estimated that every rupee invested in construc-
tion would generate about Rs 0.80 incremental earning to GNP. The corres-
ponding figures for agriculture and manufacturing are about Rs 0.20 and
Rs 0.14 respectively. From the fiscal point of view, investment in construction
is more desirable to boost the economy. In developed economies, like the
U.K. and the U.S.A., the fiscal policy makers routinely create favourable or
unfavourable situations to guide the real estate market which in turn affect
the construction and the short term economic environment.
Construction creates large scale employment which by itself is a sig-
nificant contribution to the Indian economy. It is also a good vehicle for the
distribution,of wealth which means that a significant proportion of the
money spent in construction moves directly from the rich to poor people. In
India, it is estimated that about 3,100 mandays of unskilled labour 3,000
mandays of skilled labour and 1,300 mandays of technical personnel are
required for every lakh of rupees invested in construction. According to an
estimate for 1983, there are 12 lakhs of workers regularly employed by the
corporate sector, 24 lakhs of workers employed by the small contractors and
Introduction,
non-reporting sectors, and 67 lakhs of seasonal workei rork only,p

of the year in construction and the rest of the time in agricultural work, ~r
available. The total workforce associated with construction was over 4 per
cent of the total 245 million workforce in India in 1983. Tn the organised
sector, employment generated in construction is over 5 per cent of the total
employment. Employment generated in construction also significantly helps
the rural population. According to 1971 census, about 51 per cent of the
construction workforce comes from the rural area and 49 per cent fronI the
-
I
urban and semi-urban areas.
The size of the construction industry and its impact on the nabional
economy will be evident from the comparative data of the s
plan presented in Table 1.2.
Table 1.2 Investment in gross domestic product, GDP (19e
Amount
Incremlent
(at 1979-80 prices)
Investment in GDP
(in crores of
per cent
Rupees)
Agriculture
Construction
Manufacturing
Transport (except
railways)
Trade
It is surprising that despite its massive size, the ce t has

not declared it as an 'industry' which would enable ir ro nave easier ac----
'Cf'SS
to bank finance and other economic benefits. There is no comprehensive act

that guides the labour welfare for the construction workers. Till 1990, the
government did not have any national housing policy that is intimately
linked to construction activities. These features probably indicate that the
macro economical aspects of construction related issues have not been
adequately attended due to the lack of awareness caused by the limited
knowledge and growth of t h ~ s b u c t i o nmanagement theories ancd re-
search under Indian context.
FEATURES OF CONSTRUCTION ECONOMY
From an economist's point of view, construction is a service which has a

demand to improve economy. The position of construction in the overall
economic system is presented in Fig. 1.2.
condition
General General
demand
H Buildings for
production h
Buildings for
investment H New creati
Buildings for
dwellings
Facilities for
structure
El- Total
supply
I Market for real estate

and infrastructure
Fig. 1.2 Economic context of construction
A study of Fig. 1.2 will point out that the construction sector is directly
related to the :general economy of a country. Construction activities are
generally encouraged by buyout economic conditiLon.
The construction industry has certain sl momic clharacteri!stics that
are presented here:
1. Construction projects take a relatively lent;time to be planned and
I
considered.
2. Life of constructed projects are very long. T
IL
t ;C mn- >oq*,.n,4 - 4
..,ca~uLcu least in
decades.
Constructions are always allotted tc) lands. 1"he normi31econornic laws,
..--
like import-export of goods, are not applicable to constructior~s.
4. Public infrastructures, such as roads, bridges and dams, which are a
major portion of construction cannot be studied with the usual
concept of profit maximization.Spe!cia1econ essential
to value these facilities.
.I
These peculiar characteristics have led ro me growrn or special problems
#
and solutions in the construction economy.

Construction industry is generally much fragmented. A ni features
Introduction 11
of the industry generally create favourable conditions for the establishment

of new firms. The features are presented here.
1. Construction firms have relatively low of fixed costs. As the
products are assembled at the site no large premises are require'd.
2. Construction firms have relative low rt?quireme,ntsof wc>rkingcapital.
The construction is started only after ,specific cxder anc1 traditionally
monthly payments are made.
3. Construction trade normally uses labour contractors. Perm;
workforce is not maintained and fixed cost is lowered.
4. In the Indian context, very few machines are essential and, therefore,
requirements of initial investment are low. Even in developed'
countries, smaller firms have easy access to leasing comvanies to
obtain machinery and plants as required.
These factors have made the construction industry very corn
_ .
..
C..
firms are entering into the market continuously. The prorir margin is lvwer
than that of other industries. Statistics about the size of the construction firms
'
in India are not readily available. In U.K., 90% of thle firms t2mploy fewer
than 8 permanent people. The 100 biggest firms in U.K.account for 20% of
T r
the industry's output. According to one estimate, in U.K. there were about
1,80,000 construction firms operating in 1990 and the total number of
registered firms in the country is about 3,70,0nn
2"".
In U.S.A., the number of construction firms exceed one milliion. How'ever,

60% of the construction is executed by the to1p 400 finns, while in India, it is
estimated that about 90,000 firms are registered as contractors in various
government departments and agencies.
The above statistics provide an idea about the fragmentation and competi-
tion in the construction industry. The average profit nnargin tends to be low
and is generally assumed as 10%. However, the actual gross book profit may
be even lower than 10%.
ROLE OF CONSTRUCTION MANAGEMEN'
In the construction industry here was a time when all the projects were
labour intensive and management in those days meant proper utilisation of
labour to make optimum progress in construction in the most economical
manner. But nowadays technological advancement and new scientific invenl
tions have added new dimensions to the construction industry. A project is
now considered as a group of activities having interrelations, which may
include the role of specialists and specialised work using the latest
knowledge and skill available, to be undertaken in the most systematic
manner failing which the project may be stalled or the progress may be
12 Construction Management and ~ ~ a n n r n g
hampered. This "mdst s ic manne ires adop

to control the activities witnm the time rrame at a cerram cosr. lnesc
techniques cornmonly known as the Critical Path Method (CPR/I) or thc
Project Evaluzition and Review Technique (PERT) are being appliec
3 .
nowadays for the management - of the projects. The use of plant a n c

machinery in construcition has improved the quality of construc:tion a n c
reduced the time of ccbnstructic>n. New techniques and methods are nom
. - -
adopted in construction with the aid of these plants and machinery to m a t
construction easier, well within time schedule, and of high quality
The application of these construction management techniques, t:he .
use o:
.
plants and machinery, finding altematii{e soluticons and selecting; the bes
.possible solution with the aid of ' computer, have Imade theI whole F brocess sc
~ for la:rge cons1tructiona
scientific that it is now difficult to thin k of g o i~g
activities without these exercise!
Why is COI I classifiedI as an indlustry? Hc>ware the quality o f construc

.. . . .
8
. I C L l
tion and saving or nme ensured in moaern construction? k~enrionsome or mnl
types of construction where the use of machines and modern equi
almost compulsory. How can you make construction scier~tific?
What is labour intensive construction? What are its disa'dvantagesc wnat arc
onstructicIn in the csountry? C
the hurdli?sof mod1ernising c8
Features of modem construction.
- . . - -.
Explain private and public constructions stating their relative merits an(
demsrits.
Who are t.heowner,, the cons1lltant and the contriactor? What are the duties an(
- .
,,,,, .
,="h /+haawner, the consultant and the contractor) one o
responsibilities of e,,,,
them?
"In a modlern construction pr*eject, con! nanagemcInt has got a definitc
"-1- .:-1,.2l
..'--L
to play.''
roject, whco is suppcjsed to finance the Fbroject? What are thc
n of finance? Expla.in the me1rits and d emerits oi! collectio~
What are the differ1ent ways of engagi~ &ant? WI at are mf

consultancy fees? Iiow are the fees dc ? What a1re the recc
r ... ..
., lnalan lnsrirure - LL- -- 1L-- -.
nons or< me ~ T 1.
orr Arcnlmecrs
.I.:.. A 1-
reraruinr ule curlsultalicv
Explain tlne following:
(a) Capitia1 investrrlent quiremenl
-.
.-
Write brif?fly about the differ.ent items which add to the <
:onstructil on plays am import;3nt role in the devel'opment oi
and establish this .v,iew.
CHA
ONTRAC'"
contract betweenI two or ties for 4 :ts to

.---..LZ -1- L--L - .> -L :-
performeu or rerriuneu rrvm wnicn nas veer1 arriveu d~ UI suc11a r l l dnner,
A.
2
:t forth irI such a form, an 2nt that it has enf legal
-
!feet.
m a civil enpeering construction contract, an agreemenr is slvn pd
0- ---
?tween the owner and the contractor which ensures the cornlpletion c)f the
8
~bwithin the scheduled time, following drawings, designs, specifica~tions

.
.td workmanship as given by the consultant and at a price as quotea ov the
.,
I . OF CONTRACTS
YPES -
ivil en* ontracts 'ally of t~
1. Contract at a Fixed PI'ice

This is the oldest and the most comrnon met1~ o of d leitting out a work under
,-.
contract when bids are received at rxea prices. These may be based- nn
v
---
~ o t i n gUIlit prices for eadI of the i tems o f .work an(1 the toti31 sum sl: a n d ~
Ir the tot,a1 cost of the projject or sc me times, a lump sum, i.e. a single total
rn may be quoted for the .,ink
, Contract other than Fi]

a
,
.
clc ,.I& "+
.,. .I "*< .+ul
utc a c r u a l cuJr
-g +LA
first derived and the contract is I
uLc" 1 u l c L r
L ,
IS
l a m m2r that the contrac:tor wou!ld receivt2 a profit over the actual cc
fixed' fee or fixed percentzige etc.
Contract at a fixed price may be divided as follows: bill of quantities

contract, sihedule of rate contract, and lump sum contract.
In a similar manner contract other than fixed price may be classified as
follows: cost plus percentage contract, and cost plus fixed fee contract. All
these above contracts are discussed in a nut shell below.
Bill of Quantities Contract
In this contract the total cost is derived from the sum of the individual items
as'priced in the bill plus lump sum, provisional sum and prime cost for some
of the items as quoted. The quantities are measured from the contract
drawings. It comes under the fixed price contract since the unit rates quoted
by the contractor for the individual items in the bill are fixed. The total
quantities of work measured in the field may somewhat vary from the
quantities measured from the design drawings therefore, it does not give a
fixed total sum. But since the construction closely follows the design, the
total price paid by the employer will be' more or less equal to the total sum
tendered. It has the following advantages:
1. Payment is made to the contractor as per the work (lone.
I'he price quoted for individual items are fixed. Tk the total
:ost is more or less fixed as derive(d from tl1e measu ~btained
from the drawings
n o u g h 2rlteratior1s and dc from thc:originall drawinl5s could
Je accepted durin g constn .t even th.en the UI?it price (does not
change.
4. Comparison of a tender becomes easier since the basis of tendering is
same for all the tenderers and the price quoted are very much
competitive.
5. The bill submitted gives a clear picture of of construction,
type of construction and details of the works to be d---
Schedule of Rzrte Cont~
There a re some jobs where it becomes difficult to 7irisualise the quar

advanc~ e. For ex;mple, in case of a R.C.C. piled foulndation t he designer may
:A,. ..--.. L -L A - - LL-
not declur ~ ~ U the
L L diameter, the length and the nulrlver ur I
- 4 :-:I--
- , uerore ule
vllrs.
load fest is done on the test piles, or in the case of a tubewell, the Itmgth of
the well to be sunk may not be determine,d before the discl-large ava ilable is
.-
measured at site, or it may also be necessary ro srarr me.I. :-I.
..I - - .. I
]OD urgenriy before
all the working drawings are not prepared, so that the measurement of
quantitiies beco~ nes difficult. Under thesie circunlstances the schedule is
-9ntract Management 15
clearly hea schedule of rates" so that the contractor would only quote
the price or irems. In this contract, there may be some items which would
not be done at all or in some other items the volume may increase or decrease
when compared to the volume expected for such jobs as visualised by the
tenderer from his experience. Here the tenderer is to quote very intelligently
so that even if all the above unforeseen things happen, he is not at a loss.
The special features of the contract are the following:
1. The quantities are not generally inserted, but sometimes even if
inserted those are rounded off.
2. More items than actually needed 'might have to be scheduled s i~~ c ite
may be difficult to foretell exactly the items required.
3. No guarantee? is given that all or any of the items of work will be ca rried
out, hence ttle tendeirer has to fix up rates so that each of the iitems
.,
carrv its owr~ ., L,,
UVCILLCC--]
ump Surn Contri
IrI this con tract a single lump sum is quoted for the jc)b and is acceptec
f i: xed pricc?.This will be possible only wherI all the details od the wc
.
presenrea
. I 1 -
in the drawings so that the contractor ..
may worK
-- -
2.
our ..
the exact price
of the structure. Sometimes a bill of quantity js also attached to help the
contractor to have a better picture of the job and sometimes a schedule of
rate is also presented which may be used in pricing the variations in
quantities. This contract is better suited for over ground jobs and not so
much for structures below ground as overground structures are always
visible and quantities could be measured at any time. This is found to be
very effective when
1. The job is comparatively small
2. The job is precisely and exactly describled in all details.
3. There is not much risk attached to its (:onstruction, i.e. there ma?
be any hazard which could not be v i slalised
~ bi2forehancA.
4. Alterations are kept to the minimum
The major advantages of this contract are:
1. It avoids a lot of detailing and accounting thereby m a m g me jou easy.
2. It offers the cbwner a f'ixed total price and the 01Nner is h~appywith it.
3. The contractc)r gets a Ichance to do the work without much hindrance.
may be !stated as
ifficult tc3 accomrnodate aidditions,
,. .,
speciricatinns
2. In case of unforeseen hazards during construction, the contract
put to unlimited hardship.
Even in case of a bill bf quantity or An item rate. contract, there are

sometimes items which are asked to be quoted as lump sum. This saves a
lot of work as otherwise the break-up of sucR items is to be given andeach
of the sub-items is to be priced separately. Lump sum contract works better
for mechanical and electrical installations than in civil engineering construc-
tion.
Cost plus Percentage Contract
In this contract the contractor is paid the actual expenditure he incurs for
purchasing the materials, the installation of plants and machinery and the
cost of labour. In addition he is paid a certain percentage to cover his
overhead expenses and profit. Under the circumstances there is every
possibility that if the contractor is less efficient he will spend more money
on the project, and his income or fees being directly proportional to the
overall cost of the project he will earn more. Thus inefficiency on the part of
the contractor becomes more rewarding. Such a system is neither liked by
the owner, nor does the engineer prefer it because to ensure quality the
engineer has to pay more attention for each and every item of the work. The
contractor alsh has to get a sanction for even a small amount and has to
maintain books showing every detail of the expenses made and these are to
be sanctioned by the employer's auditor before any payment is obtained.
Over and above, the process encourages misunderstanding and mistrust
between the owner, the engineer and the contractor.
The above contract has no other advantage except that it is suitable for
temporary use in case of an emergency until one switches over to some better
contract.
Cost plus Fixed Fee Contract
In this contract also the payment is made to the contractor on the basis of
the actual expenses incurred plus a fee which is a fixed sum of money
unrelated to the amount of expenses made to cover overheads and profits.
Thus the tendency to spend more in order to earn more as in the case of cost
plus percentage contract is absent in this contractual arrangement. The fixed
fee may be decided on the basis of a competition with other co~ltractorswhile
tenders are accepted, or this fee may be negotiated between the owner and
the contractor. In this contract, the engineer and the contractor could work
together for attaining the best quality. Since they have got full freedom to
adopt any method or the best method of construction, they can change the
specifications, or the materials used in the construction to a limited extent
with the cowent of the owner, With efficient contractors this contract works
very well.
Contract Management 1 7
CONSTRUCTION BY DIRECT LABOUR
Sometimes for relatively small construction work, the job may be awarded
to labour contractors when the supply of all materials and the detailed
supervision have to be done by the owner himself, i.e. no contractor as such
is employed. This system is also found to be practised by many Government
and semi- or quasi-government bodies who have to maintain a large number
of people both labour and supervisor for their general maintenance work
and small departmental works. These departments while working like
promoters or owners may employ heir own people for new construction
projects. If required, it is always possible to increase the manpower and plant
required for such construction by temporarily hiring extra men and the
required equipment. The advantages that may be derived from this system
are that the construction may be started before the plans and specifications
are completed in all details and thereby a delay of many months in the
starting and completion may be avoided, the niaterials may be selected by
the owner according to his choice, and the changes in plans if required may
also be done easily. It is sometimes claimed that in this system the total cost
of the project may be found to be smaller than other contracts. Since the
overheads and profits to be paid to the contractor are not required here, many
of the staff members are fruitfully engaged. But experience shows that direct
labour construction tends to be more expensive than construction by con-
tract. Since contract construction is highly competitive the contractor's men
are used to working under high pressure, and since the chance of losing
their job if found inefficient is present, people will always try to produce
their best. Unfortunately, it may be found to be difficult to get work from the
departmental staff with comparable efficiency. It is also not correct to think
that in this method of construction contractor's overheads and profits are
saved by the owner. In fact the work which is performed by the men under
the contractor's employment whose cost is chargeable to the overheads must
in all cases be performed by some one and who will ultimately be paid as a
part of the construction cost. There is no personal incentive in this system to
keep the construction cost at the lowest and a lack of responsibility is felt
with all the people engaged in the work. There are a number of items of
construction materials which have got a repetitive use in construction. For a
contractor who undertakes projects one after the other the cost of these items
evens out when charged on a number of projects, but with the owner's own
management these materials are to be purchased by the owner and the owner
may not find these items useful after the construction is completed and thus
the toral cost of these items is to be charged on the project in question thereby
enhancing the cost of the project considerably.
CONTRACT DOCUMENTS
The contract for constmction is a legal agreement between the owner and
the constructor or contractor. It is a very important document which binds
the contractor to construct and the owner to pay. It describes the details of
the works, the specifications to be followed, mode of payments to 1)e made,
the duty and authority of the owner or contractor, etc. It comprises a number
of documents which are:
1. Contract drawings: which show the plan, elevation, sections of relevant
structural and architectural elements in scale, the levels, per-spective
view, etc. according to which the construction will be done.
2. Specifications: which describes in words the construction to be done,
the quality of materials and workmanship to be used, the method of
construction to be adopted, plant and machinery and equipment to
be used, the method of testing, etc.
3. Bill of quantities: which furnishes the measure of each of the items of
work to.be done as calculated from drawings (this is verified as per
actuals and differences if any are noted and cause of difference beyond
certain percentage has to be investigated after the construction) and
classified accordhng to the trade, I(
t rials usec1 for the
particular item of work.
. . , . .-..
General conditions of contract: which defme the habihties, respon-
sibilities and powers of thc2 employ.er, contr;~ctorand! engineer, covers
the methods of payment, insuranc:e, liabiliities of p;vties to the con-
. tract, etc.
5. Tender: which is the signed financial offer of the contr,actor to construct
.--
the work according to the drawings, specifications, bill of quantities
md gene~ralconditions of contract.
Letters of explanation: which are given for th elabora-
,:-- -L? --
~UII UI ~ I of
J
V the items stated in 1-5.
Legal agrr m e n t : which is signed by both the parties in contract

zonfirmb~g their :respective intention as defined in &e abotre docu-
nents.
nder to materialise ct, the contractor i
as suemitting a tender. ,, ,.,,,lber of contractors suDmit .
e an offer;known
.. .tenaers ror a
particular job and the selection of a contractor is based on certain norms and
principles. Once accepted no amendment could be made by the owner. In
case an amendment becomes necessary the tender ceases to exist unless the
contractor agrees to the amendment and a fresh document is prepared.
The Icontract document for large projects which are called for international
bidding known as global tendering are quite bulky which may run to several
volumes. They are made specifically for a particular job designed bv , a group u
or several groups of specialist.requiringseveral years. A typicallcontract. may

contain the following matters :
1. Instruction to tenderers: This will tell the contractor how he is sup-
posed to prepare the tender, when and where to send it, the sources
of major materials, g~aranteeand bond required, tax and import
ition, various schedules to be fillec1 in, etc.
e terms and abbreviations iused,
rendices to instructions which give th~
.--
' t P ~ for
I C L l l
-
s which import licence will be or will not be granted, et~. P
3. Tentier bond and schedules for corn;pletion: 'I'he schledule giving

~ curTency foIr labour and
tentierer's estimate for local and f o.eign
materials, etc.
%
..- also include some special conditions wrucn
may
..
4. General conditions of contract: GeneralUy it tabes the us;ual fornI but
. exist. . .m tne COL..,,lnfrv
of constructiion, special duties, risks and liabilities, etc.
5. The specifcation: It starts with the description (:)f the Ian XP~Y,
contmunications, climate, rainfall, topography geology river flow, etc.
of fhe project site. The specifications to be adopted for the materials
of c:onstruction and the details of construction are furnished under
"-'-heading and these are drawn group by group according to the
UUS
iten1s of work of similar nature. Separate groups may also be made

for the items of work to be subcontracted or temporary works to be
undertaken.
6. Bill ofquanfities: Normally a separate volume is made for this. It gives
the quantities for each of the items of work. The number of such itam= .
.-
A= .
L
.
should be m.ade as le!ss as possible.

7. Bill schedule: This is iI part where the c r sets out rates
required to supply labour and material for special jobs 01 r may be even
ordinary jobs.
8. Contract drawing are the drawings prepared in a reduceu -3 ---I-
sciue from
the working drawings for sending them anywhere in the:world e4 asily.
Ma of level, geology, hydrology, soil cs or foumda-
tinn, graaes of concrete, steel or other materias, ana some of- the ---
reqllired cor t details not shov r other p locu-
merlt are pru 3 these d rawings.
Construction contract within the country for jobs of comparatively smaller

size needs to have all the above documents and details; only the number of
pages may be less and the volumes may be thinner. Sometimes the general
conditions of contract is not printed separately but referred to the renowned

authority having the possession of these documents to cut short the process
of preparation as also to have similar legal implications for all jobs of the
country. The bill of quantities for the sake of convenience is sometimes
separately printed so that several priced copies may be made.
The original tender signed by the contractor, together with all correspon-
dences relating to the negotiations of the tender, a set of contract drawings,
general conditions, etc. will form the legal agreement between the owner and
the contractor and this is signed by both the parties which then forms the
contract between both the parties.
The engineer should provide all the important information required for
tendering and present them in the tender document in a manner such that
there is no chance on the part of the contractor to miss any such important
thing before tendering. The tenderer should always be asked to visit the site
before preparing the tender. Sometimes a visit to the site may not give
sufficient information for tendering if the job deals with the construction of
a highway passing through, different parts and terrains of the country or
laying of pipe lines for a water supply scheme in a hilly area or layhg of oil
line, several visits may be required. This is because the soil characteristics,
geological features and contours for these long stretches may vary from place
to place. It may not be possible for the contractor to do the preliminary work
to ascertain these features; neither is he expected to undertake steps for
knowing them at this stage. So the tender document should be so worded
that there should be enough scope to make proper payments to the contractor
for the said jobs. In general a visit to the site would always lead to a realistic
tendering and hence should be insisted upon by the contractors. Three to
four weeks should be regarded as the minimum time required for tendering
for even small jobs, six weeks is considered as the minimum time to quote
for bigger jobs, and for projects outside the country three months or more
may be required. The engineer should allbw the said period in order to
receive tenders which have been prepared with adequate effort.
CALL!NG TENDERS
A tender notice, usually drafted by an engineer contains a brief but adequate

description of the required work, is publicly advertised in the newspaper
calling attention of tenders and giving the name of the employer on the top
of the notice. Further, it may be mentioned in that notice that no reimburse-
ment will be made for the expenses incurred for submitting tenders and.the
employer has the liberty to choose any tender he thinks best without giving
any explanation to any body and he is not bound to select the lowest tender.
The contractors are required to purchase the tenders and is not free of cost.
Contract Management 21
The price depends on the volume of the documeni and approximate

estimated cost of the job as evaluated by the employer's consultant. This is
done in order to make sure that only genuinely interested parties quote for
the job.
Alternatively, sometimes jobs are awarded on the basis of the quotations
received from "selected tenderers", which means tenders are invited from a
group of known reputed contractors who are considered suitable for the job.
This method is known as "prequalification" and saves a lot of time on the
part of the employer, consultant and the contractor. Sometimes, for special
types of jobs it may be mentioned in the advertisement that specialist
contractors having considerable experience alone apply. In order to judge the
credibility and capacity of the contractor the employer may like to know the
names of the previous employer, present labour force, plant and equipment
possessed or any other details considered necessary by the employer and the
contractor is to oblige the employer with this information.
Sometimes the consultants have their own list of empanelled contractors
who have already worked with those consultants. The distribution of tender
papers may be restricted among these contractors which have the advantage
of saving time but on the other hand this debars other good contractors not
known to the consultkt from tendering. In a special case, negotiations may
be directly made with only one known contractor for a very specialised job
or may be the contractor by his actions has gained enough of confidence
from the consultant or the employer. Such an action may raise objections
from others particularly for government jobs but for the private sector the
employer is found to gain in many ways by making such awards. Having
found a good contractor once, many companies like to continue with the
same contractor for getting prompt and dependable service from the said
firm.
SCRUTlNlSlNG AND COMPARING TENDERS
The consultant is expected to brief the employer about the offers received
from the various contractors and recommend a suitable contractor for the
job. However the final decision for the choice of the contractor lies with the
employer.
The consultant studies each of the offers received from each contractor
with an eye to judge whether the quotes are approximately similar. Some
may have quoted'with reservation, while others may insist on provisions not
covered in the document prepared. And some others may suggest his own
specification for some of the items of work which may be inferior or may be
even better than what are suggested in the specifications. There may be
mistakes in arithmetic, or even in interpretation.
22 ConstructionManagement and Planning
The time of completion is another important aspect. Sometimes the

consultant may propose the name of a relatively high-priced tenderer whose
time of completion is relatively lesser because any structure completed earlier
will yield returns earlier. In addition, the price of materials, even those
scheduled under government's supply, increases with time and hence earlv
completion is preferable.
All the above parameters are studied vis-a-vis trd offer, thereby
making a fair comparison of all the tenders.
From this comparison the lowest 3 or 4 tenders are meticulously ex-
amined. When the tenders are based on the bill of quantities, the detailed
price submitted by different contractors for the same portion of work could
be compared well. It becomes easy to judge whether the price quoted are on
the higher side and therefore unworkable. As far as the contractors are
concerned, it may be their strategy to underquote some of the items and to
overquote others. It is the consultant's job to be to note that the
quotes do not go to the extreme.
Supposing a contractor quotes quite a high price for the items of work
which are done at the beginning of the construction while low price are
quoted for the following items and the contractor after finishing the initial
items of work stops construction on any plea and finally leaves the job, then
the employer has to suffer a lot as he has really overpaid the contractor, or
even the contractor may have a tendency to give less attention for the loosing
items which will indirectly result in bad workmanship and items below
specifications. With hundreds of items of work it is found that there are few
items which cost 70 to 90% of the total value of work. These are the most
important items which should be studied carefully. The unit price quoted for
the provisional items should also be given proper attention. In case tlhe price
is high and the quantity of the item is larger than planned, the employer nas
. l . - ~
to pay a higher price which may even exceed the price of the nexf: lowest
contractor.
CH0051NG A TENDER
After completing the comparison table, the consultant may lnvlte one or two
of the lowest tenderers to discuss specific points of their offer. This may be
a clarification of some points of the tender or may be on the method of
construction, the construction schedule and other important points related
to the construction not covered in the tender. The engineer is not expected
to reveal to any contractor the rate quoted by others. This is considered
highly unethical and is not to be done. However, enquiries about the
competence of the contractor from the referees can always be made.
After the tenders have been compared on the same uniform bas]is, each
tender is shown to be in conformity with the requirements of the documents

and all the pertinent points are cleared, the consultant/engineer is to choose
the contractor and provide an explanation on why the job should not be
awarded to the lowest tenderer.
If the engineer has definite information that the contractor is on the verge
of bankruptcy or if it is found that the tenderer has plans of subletting a
major portion of the job, then the engineer has good reasons for not selecting
the lowest tenderer. Otherwise it becomes difficult to reject the lowest
tenderer.
Sometimes the tenderer may quote a low price for keeping the mer. and
equipment engaged or sometimes even to start work at a place where more
prospective and profitable jobs are expected in near future. If the consultant
recommends the tender which is not the lowest one, he has to convince the
client and other contractors about his decision. In fact such recommendaL:---
make the consultant more responsible to guarantee trouble free job.
In the report forwarded to the employer recommending the contractc
engineer has to be absolutely unbiased and has to keep facts separate rrom
opinions. He has to elaborate the relevant facts and figures of each tender,
provide his analysis and opinion, and finally give his recommendation.
When the tenderers are selected by means of a pre-qualification test, the
offer is normally given to the lowest tenderer because all other points have
been considered on the basis of the pre-qualification.
OPENING A TEND
Public opening of icl~uersis good and shoulu ve u u l ~ el u r all ~ ~ ~ e r l ~ a l i o n
tenders. The general practice is to open all the tenders at the same time by
the employer or his representative in the presence of the consultant and
tenderers. The tenders are then handed over to the consultant for reporting.
The engineer is supposed to position them on the basis of the total sum
quoted but the job may not be awarded before the engineer has detailed and
scrutinised each tender meticulously as there may be mistakes or omissions.
Sometimes the tenderer might not have followed exactly as the engineer
wanted him to do. They are at liberty to suggest any measure or method for
improvement. Thus a thorough study of the tenders is necessary to bring
them at par for comparison and then it is to be rep( the employer
giving suggestions and recommendations. No commii 2ver made on
the basis of total sum quoted while the tender is oper.,,.
Mistakes in tenders can arise innocently or may be intentionally done by
crooked tenderers. To deal with an innocent mistake the consulting engineer
may lay down rules in advance concerning mistakes which may include the
following: (i) unit price should guide and not the total sum of each item, (ii)
correction of decimals in any quoted price is allowed only if the price quoted
is found to have such mistakes, (iii) if so1ne of the items are not quoted they
should be considered as priced nil and the employer is not supposed to pay
for these items, (iv) the summary total will be correctec1 for arithmetical
errors. These rules are to prevent the juggling of prices a~nthe part of the
'
. -
+nnA-er. The engineer is to make a list of these mistakes and circulate the
L W L U L L .
list to i311 tenderers before taking a final decision.

The engineer is allowed to take m y step against the t He may
,,,I
cYclL "e blacklisted if it is found to contain intentiultal -1,
uuaLafir>. ~ u-l-lGi r- -u- l l t t t s
even after taking all care for preparing a tender on the part of the consulting
engineer, the tenderer may not really understand certain items of portions
given in the document. Clarification of these items from the consulting
engineer before tendering may be the real solution. But this may not always
be possible for want of time or the availability of the consultant. Alternative-
ly, the tenderer may have his own interpretation on these items or portions
and express the same in a covering lette~ r to be fcwwarded with the tender.
At the time of opening tenders, these poiints may be raised by the tenderer
and the engineer may give his own interpretation. .. while in case of a difference
of opinion the tenderer may raisie objectic
ACCEPTANCE OF A TENDER
A private individual may accept the offel- of a cor
1 -~
~ysimply stating:
"I accept your offer." But this simple acceptance is nor vaua as tne 1. ., .teriaer
t .
ent states that an acceptance is 'subject to contract . f
ise the acceptance is to be obtained from a company, a Joint Board, a

uthority, a Government department, etc. there is a procedure to be
followc?dfor accepting the offer. The pro(ledure is to prepar e a deecd with a
seal aff ixed by the employer and the conitractor. The consullting eng;ineer in
. . . - .. - - -
such c:lses acts as the channel of cornrnunicabon. After he has made his
report on the tenders and the employer kkas made a decisicon, he is to write
1
to the (:ontractor informing him that the employe'r is plea:sed to select him
- - ..;.-.- UA*-.I L \ V Y I L UY 13
to do tll e job and inform that the formal legal document btULtj
to be jaintly signed by both the parties. These documents contain the tender
papers, correspondences, any other matter or documents which needs to be
included as a part of the formal contract. The englneer then forwards all the
tenders' and reports to the employer and after the legal docum,
preparc:d, the employer and the contractor jointly signs the contl
- -.
athxes the seal therebv formalisinrr the contract between the varties
Lu1 L 3 L L LLCLIUII wt ~ f1i3rlbKY venrure. h e risk in rnls alscussion

~111e1e1ltlyd
med as the business risk which i!;definecI as the variability of an
is assu~
outcome and is 5iometimes quantitatively nneasured as the standard deviation
of an outcome. A quantitative estimate of a risk and the subsequent pricing

for it is a difficult task particularly in developing countries for want of a '
data base for such as statistical analysis.
There is a tendency among owners to force the contractor to assun
risks that may arise in the project. As a result, in many construction contract,
the project risk is heavily directed towards the contractor. On the other hand,
the under-prepared contractor is forced for an arbitrary pricing to deduce
the financial implication of a risk. This causes delays and lega1 battles in the
future. Therefore, a judicial allocation of the project risk amonl5 the contract-
ing parties is essential.
In a construction contract, provisions for the allocation of risk may appear
in a number of places. These provisions dictate the responsibilities of the
respective parties for covering the unforeseen situation. A representative list
allocating the risk to different parties is presented he re.
Force Majure
It relates to external events like strike, new laws, "act of God", etc. thait may
interfere with the work. Many contracts specify that the contract:or is
exempted for the part of the responsibilities affected by Force Majure.
Indemnification
It relates to guarantee by the first party to protect the second party
losses or damages claimed by a third party caused by any act of the first
party. Many contracts specify that the contractor shall indemnify the owner
from any damage suit filed by any party in connection with an accident or
a breach of law.
Differing Site Condition

This means that the difficulties and the associated cost that would be
encountered in the foundation work which cannot be easily estimated in
many situations. In smaller contracts and shallow foundations the contract
specifies that all cost for subsurface work like shoring and dewatering shall
be paid by the contractor. In larger works with substantial amount of
earthwork the contractor may not be willing to assume the high risk for
unfcrzseen circumstances. In such cases, the contract specifies that the extra
work like dewatering, shoring and management of existing underground
facilities shall be paid by the owner.
Delays
Delay occurs frequently in c~nstructionwork. Most of the contracts specify
that a liquidated damage for' each day/week shall be paid to the owner for
delay. The contractor may assume the risk of liquidated damage caused by
the delay for which he is responsible. Howeuer, a substantial part of the delay
is caused by factors for which he has no control. Inclement weather, civil
disorder, unavailability of drawings and decisions fron.I the owner are
examples of such delays. To reduce the risk u~,on the contractor, many
contracts specify that an extension of time is to ,.-lU,c, " , r;lmlted
, for the delav
beyond the control of the contractor.
The owners naturally demand good quality wor a reason;
2:c---1.
At the same time, owners do not want to share the risk of adul~~ur~cu exyerlses
that may arise during the course of work. Particularly in hndia, the contract
allocates risks heavily towards the contractor. Compet long the
contractors force them to disregard the pricing for risk. Lvnrracrs are so
drawn that a contractor during the course of work may find that the
representative of the owner is in a position to accept or reject unilaterally
many risk related claims. The situation provides a strong financial power to
the post of the engineer-in-charge and tends to breed corruption which is
not uncommon in construction work. Unfortunately, the quality of construc-
tion in the presence of corruption is invariably lowered and the owner suffers
in the long run. Therefore, the owner allocates the risk judiciously during
the development of the contract document so that it helps the owner in the
long run.
SECURITY BOND
On the contracts for construction it is usually stipulated that the contractor
obtains a security bond. Generally these bonds are issued by the bank against
a security of an equal amount to be deposited by the contractor which he
may not sell, encash or otherwise dispose of wiithout tht bank's consent.
Normally the bond is obtained for approximatel!1 10% of the v a lIe~ of the
work.
Though the employer holds the contractor in so many other ways like
(i) withholding around 10% on all on account bills, (ii) the payment actually
made may lag behind the construction by 2/3 months, (iii) the materials
- dumped at site with ad?vance drawn from the employer, and (iv) even the
employer, in case of dispute and termination of contract, may legally take
. l l LL- -
possession of all ulr plants and machineries brought at site until final
settlement. But the bond indirectly assesses the financial liquidity of the
contractor and psychologically this gives the employer a sense of extra
security.
CONTRACTUAL CHANGES AND TERMINATION OF

CONTRACT
Whenever there! needs some change in the contra1ct it is bf ?&ate
the sanne and elnter into a fresh one. For large projects con .or years
Conrracr Management 27
it may be found that the contract is difficult to work with because of the
changes or changed circumstances. Under these circumstances, the owner or
the contractor or both may come forward suggesting the termination of the
contract. It will be the choice of the owner whether to employ the same
contractor or a different one for the unfinished WOrK. 3( " >metimes the
contractor may also like to engage a subcontractor for the remzlining PO rtion
of the work.
zasons folr the tenmination may be the following:
en the 01mer ma:y terminate the Ccmtract:
If the contractor becomes bankrupt or insolvent;
If he refuses or fails to finish on time in spite of all commitn
or if the delay is caused only because of his inefficiency;
If he fails to pay the subcontractol
If he disregards laws, ordinances F architec
violates any pro1rision of the contl:act;
If there jis any bneach of contract resulting in an emergency;
(f)
. . .
If he neglects to protect the work from damages.
-
Under the said circumstances, the 01 dvised b: 1sult-
ant after g iring
~ the contractor seven aays nc~ticeto 'cermman the
--
contract taking possession of the premises and all materials, tools and
appliances thereon and get the work finished by whatevrermethc)d he
finds suitable. In such a case the contractor shall not 1be entitltzd to
-. -
receive any further payment until the work is finished. I the unpaid
balance exceeds the cost of the remaining job the difference is to be
paid to the contractor. In case such expense exceeds the unpaid
balance the contractor should pay the difference to the owner. The
expense incurred by the owner and the damage incurred bjr the
contractors default shall be certified by the architect/consultant.
en the coIntractor attains the right to termin.ate: .
If the wc,rk is stopped bly a court order for three mcs1u1s ur more
for any reason;
(b) If the architect/consultant fails to Iissue the certifical ment
after the stipulated period;
(c) If the owner fails to pay the contractor aftelr the stipulated ptzriod
of certification for the payment from tlhe cons1lltant or, the
arbitrato-r.
Tkke contractor in siuch cases after selrving dule notice to the 01~ n e r
and the ard~itectm;~y stop all work and recover fro1m the 01m e r
I
zu bonsrrucrrori Managemerrr arru Planning
payment for all work executed, pry loss surstained ulpon any plant or
material and reasonable vrofits and damaa -0
A subcontract is an agreement between the prime or general contractor and

one or more subcontractors under which the subcontractors agree to carry
out a portion of work of the project. The portion subcontracted may be of
very special nature or may be a portion where a small contractor having less
overheads could manage to work whereas the general contractor with higher
overheads is bound to lose, e.g. plumbing work or electrical work in a
building or excavation in road construction. If the contractor sublets any
portion of the work, he is to do it with the prior consent of the owner and
the prime contractor shall be fully responsible for any act of omissions or
commissions on the part of the subcontractors and for anyone elmployed
directly or indirectly by them in sddition to the liability imposedL by law
.. .
upon the contractor, and in fact there is no direct relationship between the
subcontractor and the owner. Generally, all the contractual obligations
applicable to the contractor are also applicable to the subc~ ontractor and the
-
prime I:ontractc ok after 1this unless a separate deal is made between
them vvrith the c n d apprcsval of tlle owner
RIGHTS OF THE SUBCONTRACTORS
1. To receive copies of speci:fications, drawings and errery othe!r details

as given ito the prime contr,actorincluding a copy of u schedule
I
of quantjities.
.--
He is not liable for any
. .
omission, commission or
-
negligence or me
prime contractor.
., In case.of damag 1 any firtr hazard or other natural calamity
the main contract I compenlsate the damages
He is SU]pposed to get pa yment from the rnain contractor M

L, ,
. LLLLC
days aftel L - -.-.-
~ullsultantCCL
-.-...I.:L:.-." 4
L L L ~ CU p. y l l lent,. less ,L-C,.
~ ~ C I C L ~LLLUI L lllullcy
and generally 2?/0 cash discount to the general contractor. In case the
contractor fails to pay he can suspend the work with due notice and
go for an arbitration. The owner has pot the Ivower to vav the
0
subcontractor anci deduct the samc from thle contrac:torrs bil

He is in most cas,es entitled to get power a~ n 'wate
. . . d .. r from tlle. prime
contractor, could use the scaffolding erected by me maln contractor,
.
claim for the allotment of space fcbr huts fc)r his ow'n men and most
of the facilities required at site.
6 . In case of dispute he has the right to take steps within the provisions
. of the contract.
DUTIES OF THE SUBCONTRACTOR

1. He is supposed to execute and complete the work specified including
the variations within the conditions of the general contract.
2. He is not supposed to sublet his work without the prior permission
of the owner.
3. He should not act in a manner which will cau! y to the 1
contractor.
4. He should not charge the main contractor to r
in his own work.
5. He should insure his own men and property and e the
certificate in case f i e contractor wants to see the same.
6. He is supposed to follow the instructions of the architc,..
7. He should make his own arrangement of power and water from the
source provided by the prime contractor.
8. He should not make wrongful use of or interfe re with idle contractor's
property and should take full responsibility o!:the plar\t tools, e!quip-
ment and indemnify a contractor from claims.
9. He should not suspend +hework without gasonable cause, refuse to
remove defective work, commit an act of bankruptcy and in case of
any such action the prime contractor has the power to terminate the
job.
MARKETING
Marketing has been defined in a number of ways, tjut the cc2ntral point in
most definitions is that it includes the performance of business;activities that
direct the flow of goods and services from the producer to the consumer or
user.
For a single firm, the task of marketing includes the dissemination of
information about the firm's range of services to the potential clients and
impressing upon the potential clients its capabilitic actice, it may
include a number of steps as shown:
1. Identifying the potential market commensurate with the firm's
capabilities (i.e. geographical locations, government or public com-
panies and size of contracts).
2. Identifying the potential clients. It includes tender notice scanning,
enquiry from professionals like architects and consultants.
3. Evaluating and if necessary altering the product mix. In the competi-

tive business world, a firm is always under pressure to improve and
diversify its services. For example, a building contractor may find that
he is losing tenders because competitors have in house capabilities for
piling work. The firm is now under compulsion to diversify into piling
work. However, a marketing study in time would have allowed the
firm to discover the need for piling equipment ahead of competitors.
In theory, the primary purpose of a firm is to maximise profit. In practice,
a number of other factors like continuity of work, execution of prestigious
contracts and market share of a particular client may shape the marketing
policy of a firm. Marketing is a management function which enables the
company to keep in touch with the customer needs and thus helps to ensure
the long term prospect of the firm. It is changed with the movements of
products and services from the producer 1:o the u s:r. The ability to construct
a project does not guarantee success. The ability to sell the service at a profit
is the critical test.
In the adoption of a marketing strategy, a firm has to c
analysis which determines the following issues.
The present market share of the comvanv tu e a c l l c l l n l r UI t;luup UJ
:lients for different classes or work

f i e market share and turnover for major compenrors mar rrequently -
compete with the firm in tender bids.
3. The recent growth records and profitability of the m~ajorcorn
or representative firms of the same size and type competinr uL ulr:
market.
4. The mark-ups of the competing fi~ from tht:tender
1: study would point out thce improvements r
i ompetition in the industqI.
. .
The porenr~alof the market is also requlrea to be stualea. lne study
should investigate: 1
1. The volume of work in each class c~fwork tlhat is pu't to tendt
I In in each year.
2. 1
.
sentative! lists of the contracts where major competitcors who
.. -
frequently .taKe part in the tenders with the firm have competed m the
last year.
3. The forecast of the likely growth in the co:nstruction sector in each
class of w--'-
' ULLC.
The marketing survey should include the potel~tialfor

ntract Management 31
acquire new resources that would be required to calnry out the increased
volume of work. The analysis for increased resourcc!s would include the
fol-lowing:
1. Capi.tal is the portant factor in Imany cas;es. Incre,ased req~ lire-
men L UI
b -1 " - - : A
~aylialis either satisfied from CL, L I L ~uwlLers' fun^ uL lLVlll
A,
.
, I,.. .c.,. the
lending institutions. The present economy inI all countries hi3s a
periodic boom and slump cycle. The g o v e r nlent has to react like
changing interest rates to counterbalanc~ .-, ,,ALIIC, .--." -.-
I I ~ ~ L L U C L U L L U ~ L L L Lcycles.
'In a planned econom y, the banks generally advance loans only for
specified purpose. A J'irm in search of fresh capital is therefore at the
-- - --- - - -.
----- -:y of the macroeconomic factors to obtain funds. These factors are
mPrc - -
then?forerequired to be considered in the marlceting pc f an

indi~ ~idualfirm.
2. ln the construction trade, experienced and effective manpower m the
management is short in supply. Theoretically s peaking, a firm, after
obtaining a contract, may appoint new manage!rs to ex€!cute the job.
Such overnight expansion in practice is too risky and may not even
be feasible. Commitments towards the company, rapports among the
managers, confidence between the different levels of management and
supervisory staff are all essential for thc2 successful execu[tionof- a job,
and these are very difficult to achieve in an otremight Iexpansion of
the total management. A firm is the1?€!fore re1quired tc> analyst2 its
management expansion capabilities wlule cond uctine tlle marke
study.
3. For large constructions, equipment availability is also a m a p ~ullcem.
The firm has to explore the possibility of acquiri tquipment to
increase the work volume.
4. A number of other factors like the increased requirement of materials,
labours and potential for obtaining government clearances, if any, are
also required to be included in the market survey.
PUBLIC RELATIONS AND ADVERTISING

Advertising, and a more encompassing topic, ~ U L J U LI n a L l u l m (J ?R) are sc>me
of the least understood and appreciated managemen~ttools. Construction
companies, in contrast to the consumer indus,tries, are very conservative in
PR and advertising. Advertising and PR if properly m ana aged are powerful
tools available to corporate management of a construc n to incn
its performance. Advertising is essentially a controlled c ication a1
the firm and its service.
It is quite a difficult job for a client to select the contractor for a particular
job. In construction contract award, negotiation is very common and the
Instruction Management and Planning
client may find that severa1 contractors a g to execute the cj at the

same price. The cllent . ..
.. . under tnese circumstances would consider~bfactors
other tlhan price to award the tender. The client's enquiry at)outthe c'ompany
h
would be met t\rith the information obtained from the PR a1nd advertisement
. -.
about the firm. The advertisement and PR are, therefore, kcl ~ ~ ~ ~ to ,,.-7 4--.
~ r t a n
a firm for its miarket pel.formanc1e.
A f irm can tiake a number of steps to improve its PR. ,A few modes are
- .
. - c~ll.-....:l
presenited in tht IuUuwli ng:
"
1. Ileveloph~gand m.aintainir~ga good record of notable pertom,ance like
c.arly corrlpletion :md low i2mphasis on contract claims, and if possible
.--- - -- - - LL-
CUUlpdIlrlg ule udta
1-
with industry average.
2. Taking pa rtinexhiibitions, :seminars,, practica1training;courses with the
universiti.es, etc.
3. Encouraging employees to contribute arbcles m learned lournals, news
magazines, etc.
4. Producing video c tg difficu~ lwork
t 1s which
have an academic LU L/lU1C331Ul Lal *L L C l C 3 L CLur.,.I+ LC.,.CAVCI
C-..--I. , La atu 3tudents.
5. kidvertisement in the appropriate nnedium :tbout the ~y'swel-
f are and 1:raining :scheme and safet~ YT records
6. Auvcu~ceu
,2------; 1 -- - -- - -
suuuurt
- -I I
__._1:_. ..a. ..--
- - 1l:1.i- ~ esopnisricarea
facilities, 3
resrlng, equipment,
ised acc lanagement and technic;a1 systerns, will
! image o ogically 2tdvancedlcompan~yand solmetimes
---I- r.
c l l r r l t s rrmy uewrne Impressed with me rim
.I
A firm can in:jtitute the advertising programme i~ TS.Some

of the siteps are presented here:
. -.
1. Aavertlsement in the press about the completion of a project and the
new management appoint]ment.
2. Advertisement in the trade journals with em n timely comple-
tion, etc.
3. A standarid colour scheme imd logo for all cc sapers, t~
tation anci plants.
etter quadity stati,onery.
&active sales brcxhure.
[oarding:;installefi at work sire ma ar public places liKe play grounds.
booklet or hand1out desc~ ribing thc compat I perfor-
nance th;at can be, distribu.ted to thL e prospe nforma-
Ion.
ATIONE
C---l L-.
Internailul~dluus~llcsscar1 ue uerlneu as profit-oriented business relation-
ships conduc teci across 1 bound; )art fronI the fa1:tors in
domestic markc?t, interr construc rket has many rnore to
consider. The pricing considerations, tax structure, foreign sta :gula-
tions, material and manpower movements etc. are only a few examples.
However, international construction market is rewarding particular]ly for
developing countries like India because of the availability of relatively (
and trained manpower. In addition, it is beneficial to the national ecoinomv
dlue to for-eignexchange ea mings. 'I h e globa1construction cor tracts that are
tlraded acl:oss national bow~dariesc,an be estimated as US 100 billion d ollars
per year. About 33% . of the rr~arner2IS situated in Middle East a.-Al u -1
-
---l--L --.. ' 1 C O /
~ U U U L LJ 10
- -
L
is generat jia, Africa and Sc)uth America cornbined. 'me balance is

traded el!sewhere. Firms f 'rom United States and IEurope clominates +e
1, ,
international consrrucrion... market. 1Each of USA and ,A,--# -..~.
vvesrem Europe cum-
-
-Pined has a share of about 40% of the international contracts. Each of,Japan
(
and Soutl1 Korea hbas a share of 9% of the cointract. India has 1ess than 1%of
.. 1
the internationa construction business. The vaue or contracts execur~dhv
hndian finms are p:resented in Table
., 1. International construction cor

Ta,.,~hle3
Amount
Uverseas Construction Council of India and National Institute of 'nnc-

truction Management and Research have p~iblished information relati
the performance of Indian firms a b?oad.
~
International construction market is dynamic in niature. Support seirvices
like environmental impact analysis, financial reports fior international inistitu-
tions, soft loans, tumkey services includin.g machineries and man^bower
training are provided in the construction activities. 'Consortium Approach'
with other firms or national governments may become essential. Firms
,should therefore be properly organised before entering the international
Clonstructi et.
LAL
2.1 Whe~tis meant by a cor : fixed

. A & ,
.&
I
.,
..
price a.,Al i u4,,L" v l i u a c r UUKL
.
LII~II I~ACU ~ L ~ L C :
2.2 Expl!ain the fcdlowing contracts. Under wf lat circun- re each of ' these
conbracts found to be useful? Mention thei~r merits a] its.
(a) Bill of quantities contract

(b) Schedule of rate contract
Lumpsum contract
Cost plus percentage contract
,=, Cost plus fixed~feecontract.
What do you mean by construction using direct labour? Under what cir-
cumstances is this found to be effective? Do you think that this contract will
yield economy compared to other contracts?
Name and explain the documents which comprise the total contract for a
construction project. What are the matters required to be contained in a typical
contract?
Describe the procedure for calling a tender. How are tenders; smtinised and
compared before the selection of the tender is made? How is a tende'r to be
chosen?
Describe the procedure for opening a tender. What are the formalities to be
performed before accepting a tender in case the job is to be owned by a (i)
private party o'r (ii) government or quasi-government organisation?
What do you understand by the term "Risk allocation"? In this connection
explain the terms Force Majure, Indemnification, differing site condition and
delays.
What is a security bond? What is its purpose? Why is it so important for any
construction project?
Why is it required to terminate a contract? Under what circumstances does the
owner or the contractor terminate the contract?
2.10 What is sub-contracting? Why is it required sometimes to engage a sub-con-
tractor. Write down the duties and responsibilities of a sub-contractor.
2.11 Define the term 'marketing'. Write down the steps adopted to i m ~
potential client about the product of a manufacturer.
2.12 How does a firm conduct a market analysis? How is the potential of the market
studied? What are the things to be included for the analysis of increased
resources?
2.13 What do you understand by the word 'advertising'? How are the public
relations maintained through advertisement?
2.14 What are the steps to be adopted by a firm to improve public relations? Iliscuss
the number of ways with which a firm could institute advertising programmes.
2.15 Explain the term 'International market'. What is meant by a global construction
contract? Give an account of the percentage share of Ftemational market by
USA, countries of Western Europe, Japan, South Korea, etc. in the field of
construction during the last ten years.
Details of Construction
INTRODUCTION
Whc ~rojectre he green signal from thc client les

- .em Ahr\ I .nhr\mc.G
prepared for the pro]ject. The detailed cost an; done at i3 later diate
when the working dr,awings a re almost ready. 1 I cost estimate is f air
enough to predict the CVoL "Ithe project with1 a cclraul ----
.-.- y r ~ c c l ~ ~ asay
&
-.-,.. -
t;~,
within f 5% to 10%. In order to reach the fina 1 costing every item of work
has to be analysed to evaluate the cost of materi.al and labour separately and
1 - 3 1- --.
then overhead charges and profits are to be adaeu 1r1 vriler to determine the
costing or a chargeable rate for the item. This particular exercise leading to
the rates to be charged is very important so that whenever required it is
possible to convince the concerned persons about the rates establishing the
logic behind the quoted rates. This process is known as the "analysis of the
rate" or "rate analysis". Normally, the consultant has to find out a cost of the
project based on the quantities of each of the items of work multiplied by
the chargeable rates. But this is not the final. Quotations are then invited from
different contractors who we supposed to quote as they think best. The
consultant could always challenge any rate which seems to be too low or too
high if his exercise of costing is ready with him for the sake of comparison.
While doing the exercise it is required to get the ideas from different sources.
One of these acceptable sources is the Central Public Works Department or
C.P.W.D. as it is popularly known.They have got a schedule of rates covering
almost all items of work except very special types of items. These schedules
are generally kept up-to-date. Considering normal and abnormal price
hiking the practice is to quote "percentage above" the schedule.
Similarly, there are State Public Works Department or Statc! P.W.D. in
different state,s which are also good sot nformati ding rate IS
- - .
and estimates. For remote and inaccessible prlacca it may be L ~ Y U U C U I cv~
&
ullc~t
--IT--
.-
local data regarding rates and base the estimate on these rates. One has to
be very clear in his mind as to how best one could quote the rates so that
the quoted rates are justifiable. While taking measurements of items one has
to follow the drawings. But one should not follow the drawing;s blindly.
There are codes and standards which often make the estin:lation of quantities
simpler and easier though not exact but very near to the- exact .values -.
-L
and
are accepted f or all pri~cticalp~ Thus the nd standards have
got very important rolc3s to pla]
ESTIMATES
Before the commencement 01 any projecr, me consulrant should g v e me

owner clear ideas about the approximate volume of different materials
required for the project and the probable cost of the complete project. In order
to have this idea the consultant is supposed to work out the estimates of
materials and money required so that tlhe owne:r may get prepared for the
procurement of the materials iin advan.ce and 2mange the money for the
. .. . . ..
project. Otherwise, the project mignt get staled while running. -
. ror an;y
public:work prior sanc:tion of the funds is essential which is also based 01 n
.
these estimates. Estim,ates are required to be F~reparedat differlent times
. .. . adlustments
.-. .tne project is through so that
before.anaarter .. . .
and minor changes
-
in specification and quantity c made ax~d the p roject cost is kept
within the budget. There are di yes of es;timates Inamely:
ough Cc,st Estinlate

,,
,, ,S also sometimes called the preliminary es~u~rarc
UL l v u r l t ca~u~are.
"
This i!s preparc!d on the basis of
8 matic dri f the pro.ject usin!Z
any 0:€ the foUl3wing methods:
(a) Unit rate estimate The cost.of an unit is first determbned as found from
recent experiences. This unit may be a bed foi: a hospital builcling or a
- ... . .
classroom for a school or a eallon of water for a- water srorage
3
'
c-.. -a
tank or a
kilom~etre lengith for a h.ighway. :f i e total cost is de 1 from th~ e product
of unit rate ant3 the nu1 mits.
Cb) PIlinth area estima is very much in Ipractice jfor evalu ating thc:
cost 0:f apartmc lctures having re^)etitiveunits. He11e the cost
-1 L- .- .. -.
UI ule units is spelr on me asi is of the plinth area or tne uruts. lrus a s o
E .
includles the cost of land, free space etc. and one mlay calcullate the tc~ t aspact
l ?
built L~pagainsit the total cost of the project so tha t the rate! may COIne out a5
Details of Construction 37
per square metre of the built-up area which may be termed the plinth area
or sometimes on the basis of carpet area or floor area.
(c) Rate based on volume content or cube rate estimate This is a better
method as the result is mor: accurate compared to the plinth area method.
The volume of the building is determined first and this is multiplied by the
prevailing rate per unit volume of similar buildings under similar situations.
The practice is to include half of the depth of foundation in evaluating the
volume of the building but normally parapet is excluded from the calcula-
tion.
2. Detailed Estimate
This is based on the actual working drawings and quantities are taken out
from these drawings so that there should be practically no variation with the
actual values. The detailed estimate should always be accompanied with
detailed specifications and the basis of rates adopted in the estimate. This is
required for the technical sanction and administrative approval of the project
and also for the preparation of the contract document which is to be followed
by the contractor during the execution of the project.
While preparing the detailed estimate the procedure is to find out first of
all the rates per unit work including profits. The cost of each item is found
from the product of unit rate and the calculated quantity of the item. For
calculating the quantities of the items of work a standard format is used. The
said format is very helpful for checking the quantities at any time afterwards.
For determining the estimated cost of the project another format h o w n as the
"abstract of estimate" form is used. These two formats are presented below:
Standard Format for the Measurement of Quantities
Item Description or Height Content or Total Contt

No. particulars Length Breadth or depth quantity cJr Quantii
1
--
Abstract of Estimate Form

- - --
Item No. Description or particulars Quantity Unit Rate Amount

1
38 Construction Management and Planniny
In order to arrive at the rate of each item one may foll chedule Iof
rates of the C.P.W.D. or P.W.D. and state "the percenta5= ,4 r c,
uh ,
u l 41.
~ l e
schedule". Though this may not be very scientific since the increase in cost
of each item of work is not uniform, this is popular because of its simplicity.
The consultant has to work out the actual cost of the items of work based on
the prevalent market rates so that if standard schedules are not followed he
could judge whether the rates are under-quoted or over-priced. While
estimating the cost of construction it is important to have clear ideas about
the factors such as the quantity of each of the basic materials since the cost
is directly proportional to the quantity. Whether the availability of the
material throughout the construction period is ensured or it has to be stock
piled, the transport charges, the number of loadings and unloadings before
brought to the site, and the handling of materials at site depending on
availability of space are the other items which add cost to the price of
materials.
While preparing the detailed estimate, quantities are t from tl~e
. -
detziled working drawings. But in order to avoid unnecessary r 1s
calculations, a code has made certain simplifications which a IS
followed. Some such examples are given here to indicate their uti
Brick;masonry Here quantities are expressed in cubic mt2tre (m3), i.e. lengt.h
x brc?adthx h'eight. Brick masonry for t he foundlation an1d plinth are placem d
under one ite m and tllat for the super structure is separately itemised. But
quantities for each of the storeys are calculated separately. Thin partition
walls are mea sured in square metre (m2). For honeycombed brick wall, the
item is separately drawn but deductions for openings are not ma1de.
Deductions for door window are made from the quantities considered Eis
2
solid first. No deduction is made for openings up to 0.1 m , nor for .enas- 3 -
of
2
beams and posts up to 0.05 m in area and also for bed plate and wall plaiie
bearing of chajjahs up to 0.1 m depth. Bearings of floor and roof sk3b are also
not deducted from the brick work. The rectangular portion of the openmg,
when the top of the opening is made as an arch of small rise, is only, deducted
'
and not the curved segment for determ ining the quantity to be dt2ducted.
m
Plastering and pointing This item is calculated in m2. Measurements are

taken for the entire face of the wall for both sides and then deductions are
made for the openings as,
(a) No deduction is made for ends olf beams, posts, ra~fters,etc
..
(b) For s m d openings up to 0.5 m2 no deduction is made, nelther are
of the j im b s sof fits and f ~ g are
s acided.
(c) For opelnings of size 0.5 r g is cons:idered orI one fact
the other face being treated solid and no extra for jambs, soffiits and
sills are considered.
(d) For openings exceeding 3 m2, area of the opening is deducted on both
faces and areas for the jambs, soffits and sills are added.
Reinforced concrete work All reinforced cement concrete work is measured
in cubic metre. Bearings of beams and lintels are added extra to get the
dimension. Though the quantity of steel measured in quintals/tonnes are
paid as a separate item including bending binding, no deduction is made
from the volume of concrete occupied by the steel reinforcement. Form work
is also measured separately as a separate item but sometimes for smaller iobs
with conventional shuttering work the item may be included in the rate for
concreting.
Similar do's and dont's for taking measurement of any item of wc.-I. ---
available. One may go through any text book on estimating and calcu
required.
3. There 'are other estimates namely revised esitimate, supplementary
estimate, etc. which could be presented as f~ollows:
Revised Estimate
This is made when there is a change amounting to more than 5% of the
----
original value due to price hiking or change in specification. But thi-s drips
not include any major change in structural design. the met1
preparation is similar to that of a detailed estimate, a lstimate 5
be accompanied with a comparative statement showmg variations from rnp
original work and also reasons for the changes.
Supplementary Estimate
This is required to be prepared when some of the it€!ms were ked or
not foreseen during the preparation of the original est.hate.A found
L -A;-" .-,. &L-
that when these supplementary items are included it :,-5uu15 Lu 3UlYC 133 U L C
sanctioned amount, a supplementary estimate is prepared in the sarrte line

as the detailed estimate. This should be accompanied with a statement
showing the extra work involved and the reasons for preparing. this ~ ~ ~ I I -L C I L ~
L2- L-
should be clearly reported.
4. Total Estimate
This is also known as the complete estimate which furnishe:s the toti11 cost
of the project. This includes cost of land and requir~d land survey, clost of
. .
construction of the project, consultants' fees including supervision, visits, etc.
cost of water and electricity required during construction, legal expenses like
the examination of deeds, the title of land, the agreement for the contract and
4u ~~onsrfucr~on
danagemenr ana rrannrng
other legal matters, if any; contingency of 5% over the cost uction

,,c, C,
for extra work, if any, Thus the total estimate is the sum of all c ~ U t c l l r 3"1
expenditure to beI made ir1 connect
RATE ANALYSIS
This give!s the details of the analysi , per unit area or 1)er unit vvolume
.. r . 1 ~ - .. -...-.- I-. m--
or per number whichever is appucable for an lrem or worK or supply. Ine
analysis would give as to how a particular rate has been obtained and its
justification or the logic behind its determination. This would include the
cost of materials or the cost of different ingredients required to prepare ---- the
-- -
material, the cost of labour to produce the item of work and cost o f other
petty expenses required for the work. The item should follow Icertain
specifications and the rate should be based on that. It might require tne use
of tools and plants. A certain weightage is to be given for the use of these
tools, plants or machines based on their production capacity and the rate of
depreciation or replacement. On the top of the contractor's profits, ov~~,.-.., ~rhparl
and establishment charge:3, and in( ftarges are also tc ) be inclu lded in
the rate of work. Broadly; the rat( charged should ble based on the
following aspects:
1. Quan~tityand Cost of Materia

The q u a3tity of nlaterials required for an item of work could be ascertained
based 01 n experience or dards a7vailable followin;g the relquired
specifications. The costs o 11s are taken as dcelivered iat site inclusive
of transpjort, local taxes, etc.
2. Cost of Labour
For the cost of labour one must know hour many li3bourers are required to
produce a certain item of work. There ma;y be a vziriety of hands required
..
for the job, e.g. artisans, masons, coolies, nelpers and bhistis (sprayers or
watermen). They have got differerlt wage 6itr~dures.Therefc)re, the calcula-
.. .- .. . .. . . . ..
tion of rnunbers and cos t of hanc3s are IFlquired to be found out. In this
connection the Ah Uldla btanaara bcnedule of rates prepared by tne luational
A. .s - 7
Building y be refe: a1 prevailing rate:;should also be

enquired
3. Cost Of TOOIS ;,Plants and Machinery

Depending on the type olf work i~~volvedithe equil)merits and plant
- . .. ..
.* ..
usea are selected. m order to rationause me appornonment of charges ro we
imposed under tl.lis heading especially for jobs which involv,e big plan t and
machine:S, one is to determline the p robable total production tlle m a cle~may
Detipils of Construction 41
give or the total number of hours the ma chin^e may run during its lifetime,
-
and cost of a similar one at the end of its lifetime. prom these two figures a
basis is formed which will indirectly evaluate the proportion of charges in
the form of a percentage of the total cost of the project to be added on the
rate of this item of work.
There are certain other small tools and plants where the above exercise is
difficult to perform. The cost of such equipment may be included under the
heading 'overhead'.
4. Overhead Charsges suchI as Supervision and Visits

This includes all items ror running an office like rent, electric charges,
telephone bills, depreciation of office equipment, staff salary, salary of
supervisors and engineers, stationeries, perishable materials like ropes, nails,
G.I. wires, or tools to be provided to the masons, artisans, or helpers and
labourers and sundries are also included. Cost of travelling, visits of senior
personnel occasional entertainment to concerned people etc. is also to be
included under this heading. All these are again expressed as a percentage,
say 3 to 5% of the rates to be charged on the items of work. Though for
smaller work these may not be substantial and may be ignored but for big
jobs these a re to be jncluded.
Contractor's Prc>fit
A contractor will take all the trouble of undertaking a job only when he ealms
a reasonable amount out of it. The construction itself is full of hassles ,and
hazards. This has been made more difficult due to certain advantalees
demanded from the associated people. In addition, there are factors &e
political interferences or interferences of local influential perscsns and tlaeir
-.I= C- -
followers, which have made this profession more difficuri. DU one will t ake
this venture only when one is properly rewarded otherwise o.ne mighit be
forced to sacrifice quality. An average profit,after meeting all dule and uncdue
expenses, to the tune of 10% for big jobs and 15% on small jobs- ueymdine -1
on the cost of project should be considered reasonable.

The analysis of rates for the three major items of wok brick wc
plastering work and reinforced cement concrete work are presenrea 1n--..
.-*-3
e n ._
provide some ideas. For more details and other works one may
standard textbooks on "Rate analysis and estimation".
The primary ingredients of the above three items of work an-.
First class b~ricks, mc and, cennent, stc)ne chips and s
reinfcxcements.
'l'he basic price of these materials as in January 1992 are:
First class bricks: Rs 1200/- per 1000, medium sand: R
3
m , c ement: Rs 120/- per bag, 20 mm down stone chips: I
m3 and average price of tor-steel of diameter 8-25 mm: Rs 10,000/-

per tonne.
The daily rate for each category of people required to be engi s
follows:
Head mason: Rs 75/-; ordinary mason: Rs. 50/-; mazdoor: Rs 40/-;
carpenter: Rs 60/-; bar binder: Rs 60/-.
1. Brick Work
3
The rate is given for 10 m of brick work.
In 10 m3 of brick work, the volume of wet mortar is about zs% of 10 m3
= 2.5 of wet mortar.
1
:. dry mortar = 2.5 + - x 2.5 = 3.3 m3
3
3
Volume occupied by bricks = 10 - 2.5 = 7.5 m
7.5
No. of bricks required =
0.25 x 0.125
~ , 150 x 125 x 75 mm)
(Size of b r i ~ MY,
Assuming breakage and cutting bricks into shape for maintaining bond as
20%,
hlo. of bric. - h= --
32130= 4000 nos.
- 0.8(1
s analysis of first class brick work in cement mortar 1 : 6 in superstructure:
Ra Amount
Particulars
(b (Rs. P.)
(a) Materials
Bricks: 250 x 125 x 75 mm 4000 1200 per %O 4800.00
Sand (medium) 3
3.3 m3 180 per rn 594.00
3 120 per "-- 1920.00
Cement: 0.55 m , 16 baes
Scaifolding
(b) Labour:
Head Mason 1
A 2
(One head mason can supervise

20 cu.m of brick work per diay)
Mason 9 Nos. ,50/- 450.00
Mazdoor 11Nos. 40/- 440.00
Mazdoor (Bhisti waterman) 2 Nos. 40/- 80.00
Mazdoor (Female) Nos. 40/-
Total
getails of Construction 43
Rate Amount
Particulars Quani
(Rs P.) (Rs. P.)
Total B/F 8701.50
Contigencies, tools and plants, 43.50
$/. [(a)+ @)I
(c) Charges for water and power 1%
(d) Profit and overheads 10% 883.25
Grand To
Rate per m3= Rs 971.50.
2. Plastering: 12 mm thick cement plastering

1 : 6 on new brick work
2
Considering 100 m ,
Volume of wet mortar = 0.012 x 100 = 1.2 m3
0% for filling in the depressions. = 1.2 x 1.2 = 1.44 m3
1 3
Volume of d r y mortar = 1.44 + - x 1.44 = 1.92 m
3
1 92 3
Cement =-= 0.32 m
h
Rate
Particulars Quantity nount
(Rs. P.) (&s.P)
(a) Materials:
Cement 0.32 10 bags 120/- per bag 1200.00
Sand (medium) 1.92 m 3
180 per ~r
Scaffolding L.S. 50/-
(b) Labour:
Head mason 1/2 75 /-
Mason 10 SO/-
Mazdoor 14 40 /-
Bhisti 1 40/-
Total
Contingencie!s: tools 2lnd plants 2%[(a)+ (b)]
(c) Charges for iwater and power
(d) Profit
Grand Tc
2
Rate per m = Rs 30
3. Reinforced Cement Concrete: M I 5 grade

- luding shuttering and reinforcements
Cost (
An
Particulars Quantit:
(a) Materials:
Stone chips 8.8 m3 ruu per rn3 3!
Sand 4.4 m3 180 per n
Cement 2.2 m3 = 66 bags 120 Per
(b) Labour:
Head Mason 1/2 no. 75.00
Mason 3 nos. 50.00
Mazdoor 12 nos. 40.00
Bhisties 4 nos. 40.00
Mazdoor Female 7 nos. 40.00
Total
Contingencies '% [(a) +
2
(c) Water and power changes 1%
(d) Profit
-
Rate per
,, ,ost of shuttering is dependent on .,,,nber and dimensions of
beams, columns and the floor area to bt? coverec3 excluding bearns and
columns for a particular case and could bce evaluat:ed on th~ebasis c~f these
items only when details are known. But the cost of reinforcements including -
bending, binding and platcing of reinforcements in position 1would wc3rk out
to be Rs 12500/- per tom~e when the basic price of steel is Rs 100aI/- per
tonne.
'ODES A N U 3 I ANDARI
Bureau c>f Indian Standards have published (Code No. IS 1200) guidelines
and instlructions for the measurement of work. These are generally followed
>rtaking measurclments and are of'ten referred to avraid disputes.
For cc)nstructic3ns to be owned by the gcwemmeint, a schc
b rates is
availablc?.If the (3entral C;ovemma2nt is to own thai: asset af ter construction
the Cen tral Pub;lic Work Department's schedule is to be followec5. This
schedule! known as C.P.W.D. schedule is adopted through(>ut the c'ountry
with prc)visions for local variations. The schedule once nlade canmot be
Petails of Construction 45
changed often. However, the prices of materials, labour and other items
involved in construction are always rising almost in everv month/year.
Therefore, the practice is to declare a reasonable? percen!tage abolve the
schedule to be considered for a particular place a t a particmlar yea~r.This
L-- --
increase above the schedule of rates may not also be- sulllcler~r
---LC-:-.
l u r guod and
standard work. The contractors are permitted to quote fc)r a percentage
higher than the revised schedule of rates and tenders are COImpared accord-
.I. - .
ingly. The contractor can also quote a percentage lower man the schedule if
he has got valid reasons and argument foa such quotationr s. The C.P.W.D.
schedule at the beginning has presented thle basic rates for fh e hire charges
for plants, labour, mate~ialsfor building and roaa worK, materials for S C N ~ ~ P S
and carriage.
Buildjn g work and its details are presented next-where one may get the
, ',,
yrlce3 s,,the carriage of materials for various leads, earth work,
lor B nrCn
I Y ~ U ~ L ~ L ~ ,
concrete work, reinforced cement concrete, brick work, stone work, marble
work, wood work, steel work, flooring, roofing, finishing, repairs to build-
ings, dismantline and demolishing and other miscellaneous ~ I.:lA;-" AIIUUL
works.
Servicles inclu ad work, sanitauy instauarlv~lb, water !$upply,
- . ..
drainage and mscellaneous items related to the services are presented next.
The schedule also include horticultural work at the end of the book.
Generally, this book has given almost all the details of items for Inormal
constructions but for special constructions if non-scheduled items appear
decision on quoted raks are taken after studying the market prices.
State P.W.D. schedules are also prepared on similar lines and ane to be
followed for works belonging to state government. Each and every state
government has prepared their own schedule of rates which also includes
building works, carriage, materials and labour. Tenders are accepted on the
basis of a percen~tagehigher than the revised ,schedule or an the
revised schedule.
The Central Guverrul~entas also the State Governments r w v e gut other
books containing general conditions, general specifications, additional con-
dition of contract for departmental materials, standard charts for material
consumption, etc. which are part and parcel of the contract and are binding
to both the parties.
For non-governmental work or works for private parties one can follow
the CP.W.D. or P.W.D. schedules but this is not compulsory. It is considered
to be more rational to price each item of work on the basis of actual price of
material and labour prevailing in the market. Thus a uniform percentage
above or below the schedule which has no scope to detail out the actual rise
in price of individual ingredients consisting an item of work is not required
to be agreed upon. These are generally looked after by the consultants.
EXERCISES
3.1 In connection with the rough cost estimate for a construction work, explaln the
following with their relative merits:
(a) Unit rate estimate (b) Plinth area estimate
(c) Cube rate estimate.
3.2 Why is a rough cost estimate prepared? I-101.v does it vary fr.om the d'etailed
estimate? What is a revised estimate or a silpplementary estin-late? Expliain the
term 'total estimate'.
3.3 Draw a standard format for
(a) Measurement of quantities, (b) Abstract for. estimate, and
(c) Rate analysis.
3.4 What do you understand by "the percentage higt ile" as
applicable to the C.P.W.D. or state P.W.D. schedule?
3.5 What are the items which add cost to the price of materials?
3.6 Give some examples to establish how the IS. Code has simplif'ied the de
of quantities.
3.7 Prepare rate analyses of the following items:
(a) Joinery work for door and window frames .
(b) Door and window shutters
(c) Plain concrete in foundation
(d) Lime punning work
(e) In-situ mosaic flooring
(f) Plaster of Paris on wall surfaces
(g) Laying of sewer lines in buildings
(h) Painting doors and windows.
3.8 Describe briefly the structure of the C.P.W.D. schedule. Mention the different
sections available there.
I
CHAPTER 4 b
Construction Organisation
and Superintendt
ORGANISATION PLANNING AND

ORGANISATION CHART
In an organised construction company like any other good organisation there

is a grouping of activities headed by persons both.specialists and generalists
who are supposed to bear the full responsibility of the job allotted to them.
As an organisation expands the problems of management also increase. Some
of these problems are visualised in advance and the company could take
necessary steps. While there are others which cannot be foreseen and demand
on-the-spot solutions. To tackle these problems the company undertakes
organisation planning in a manner such that the individuals in small groups
or in large groups or divisions take the right decision.
Thus, in a well organised company the various functions of management
emerge as they apply to individuals. Individuals are next grouped for the
group functions and finally several groups are combined to form divisjons
on a functional basis to complete the overall organisation structure. A chart
called the organisation chart is normally prepared to explain this structure.
The other important purpose the chart serves is to indicate the route of
promotions for young officers as they gain experience and training to reach
the top echelons of the company. This has got a very conducive effect in the
minds of young officers who could do the intended career planning. In an
organisation chart since the route to be followed is clearly kxpressed this
saves much time and energy thereby avoiding duplication of work. The
organisation chart may be prepared for each division and group headed by
a full chart for the company as a whole. An organisation chart indicates the
channels for the movement of action from the chief administrator to their
subordinates. It also shows expansion, contraction, reorganisation required
to improve the overall efficiency of the compa chart is generally
published and made available to any person wh aested and looking
at it one may easily know his own position in tht L U A L ~ ~ U I and
~ how one is
fitting in into the overall programme of the company. The process of charting
itself indicates the process of efficiency as because an organisation which
cannot be charted automatically indicates that there is scope for im~rove-
I
ment in planning since there is confusion in the process of decisiorI making

The three organisation charts presented at the end of this chapter sihows tht2
- -.
...
..
essential features and activitv routes for a small. medium and large company.- -
DELE OF RES VEL

-- -..- .
REQUIREMENT AND DIVISION OF WORK
In any organisation, whether it is a small company owned by a single man

or a joint company or corporation maximum responsibility is delegated to a
single man who is called the managing director, chairman or president. The
responsibility of varying degrees is delegated to the chief executive first and
then divided and subdivided down through several layelas of the organisa-
tion. In a company owned by an individual who is to lo10k into 1~lanning,
execution, finance, etc., responsibilities are concentrated. 1Vhereas :in a large
corporation the responsibilities are delegated and divided to many in-
dividuals. The executive is to organise programmes of work within the field
of his responsibility and engage appropriate personnel to carry out these
programmes as per a schedule. It is the duty and responsibility of the head
to create an interest among the juniors and subordinates who will automati-
cally carry out their work. A good executive is one who could energise
subordinates to work and make them carry out his orders. It is not necessary
for him to work continuously himself to finish the job. He is to select and
develop his subordinates as'equal or better successors for each individual
position of responsibility including his own replacement.
In a large construction company, a good number of personnel olther than
technical persons are also required. They normally give assistance for the
smooth running of the company though not technically qualified themselves.
For example many smart young personnel are required for the maintenance
of office records, finance and legal matters. Staff are' also required to assist
executives for their own sections. In a snnall organisation these pec~ p l emay
be employed on a part-time basis.
I. ., work and
The size of a n organisation is the final crlrenon for divid~ngme
the responsibilities. The following table may be considered as an ideal
distribution of manpower for a good organisatior1.
Construction Organisation and Superintendence 49
Total
Mana- Tech- Com- Finan- Secu- Accoun- evalua-
gerial nical mercial cia1 rity ting tion
One man business 15 40 20 10 5 10 100
Small firm 25 30 15 ' 10 10 10 100
Medium-sized firm 30 25 15 10 10 10 100
Large firm 40 15 15 10 10 10 100
Very large firm 50 10 10 10 10 10 100
State enterprise
and national
enterprise 60 8 8 8 8 8 100
In order to conduct construction activities at a place far from the place where
the office is situated it becomes necessary to open a reasonably large site
office at the place of construction. Many of the activities are run inde-
pendently with only a few important technical or financial decisions being
obtained from the head or main office. In practice, this usually means that
the top echelon of the main organisation is located permanently at a place
of convenience where the clients have got organisational establishment,
whereas a separate branch office and operating facilities are set up at the
place of work on a permanent or temporary basis depending upon the type
and volume of work to be carried out. This process, known as decentralisa-
tion, has the following advantages:
1. Since the unit management can become mdre familiar with the local
geography, with rules of permits and permissions required from local
authorities and the cost of labour and materials, etc. the running of
the organisation becomes easier.
2. Indirectly this delegates more power and responsibility to the person-
nel of the local office due to which they become more confident and
more responsive to the problems but still they discharge their obliga-
tion to the parent organisation.
3. The top management gets increased opportunities to observe the
performance of the middle management personnel who are supposed
to occupy the important positions of the company in future. Some-
times local units may also be located in the same place as the parent
organisation without interfering in their activities. In such cases the
field of activities of the unit office and the local office are well-defined
and there is neither duplication nor an overlapping of powers between
the two.
CONSTRUCTION SUPERVISION AND

SUPERINTENDENCE
Construction supervision is the regular checking of the construction work

which includes checking of the drawings, the quality of materials against
specifications, the equipment to be used in the work, the quality of work
during construction and the precautionary measures to be adopted to
achieve quality during and after construction. Supervision is normally done
by an architect or an engineer and it is a part of the contract with the owner.
Generally the day-to-day supervision of the work is done by the contractor
and this becomes his responsibility while periodic supervision and overall
check on quality is provided by an architect or an engineer. Contracts are
sometimes drawn in a manner such that day-to-day supervision is provided
by the architects or engineers' representative when the owner provides funds
separate from the consultancy fees for the employment of the resident
engineer or the clerk-of-works. This provides a useful check on the activities
of the contractor.
Construction superintendence is different from that of supervision of the
work in many ways as elaborated below though the two words are used
synonymously. Superintendence of the progress of works becomes the joint
responsibility of the general contractor's superintendent (sometimes called
the superintendent engineer), i.e. the man-in-charge of the project and the
resident engineer or clerk-of-works who is the representative of the architect.
The superintendent engineer is to arrange for every thing so that the progress
is not hampered whereas the resident engineer (RE.) or the clerk-of-works
(C.O.W.) inspects it and certifies it before acceptance. If they disagree they
may suggest appropriate changes for the improvement or may consult the
owner for the final decision if required. The superintendent is basically
concerned with the costs as also workmanship and materials whereas the
R.E.'s or C.O.W.'s main concern is the workmanship and material but both
must be vigilant about unauthorised substitution, improper short-cuts,
careless work and deliberate omissions. The final payment is made by the
owner when this is recommended by the superintendent and R.E. or C.O.W.
Many times it is found that the general contractor has to subcontract some
portions of the work to others. In such cases the superintendent does not
have any direct control over the subcontractor's men as he could enforce
over his own men. But, since it is the general contractor, who is answerable
to the architect or the owner, he has to take the necessary steps from the very
beginning of the project such that the channel of authority or procedure for
following them is established with any such subcontractor.
The drawings and specifications to be followed is generally a complete
document. The copies of these documents should be given to all the
subcontractors, but in case of any change found necessary during construc-

tion, it should be brought to the notice of the consulting architect and
architect's opinion is to be conveyed to all concerned in the project.
DETAILED SUPERINTENDENCE
The broad responsibilities and superintendence may be grouped as follows:

1. Record of contractor's personnel including hiring and discharging
people, trades and craftsmen, pay rolls and records.
2. Purchase and delivery of construction materials and equipment includ-
ing storage, protection and maintenance.
3. Cost records including labour, material, insurance and miscellaneous
expenses.
4. Project office control including provision for facilities for the general
office, office operations, maintenance of construction safety standards.
5. Contract changes, disputes and stoppage of Works.
HIRING AND DISCHARGING OF PERSONNEL AND

RELATED MAlTERS
Each contractor or subcontractor maintains a record of the bio-data of the

personnel employed in their respective organisation.
Instructions are issued from the site office to the head office regarding the
requirement of tradesmen or craftsmen for the job. These people are initially
sent to the timekeeper who in turn sends them to the various individual
foreman who needs their service. The foreman who decides to hire them fills
out a hiring ticket and sends them to the timekeeper who then issues a badge
or check number to be retained by them during the period of service in the
particular site. This number is entered in the daily time record in the
timekeepers office. In addition an employment record in duplicate along with
a withholding statement is issued in favour of the new recruit. The original
is sent to the head office while the copy is filled at the site. The head office
maintains this record of the person on a cumulative-basis to record the
activities of the person concerned with the company so as tg calculate the
old age benefits, taxes, etc. The following general information are recorded
in the form of a bio-data:
Date, name, address and telephone no., date and place of birth, name of
father, citizenship, occupation, marital status, no. of dependents, name and
address of the nearest relative (next to kin), and the previous employer.
When a workman is discharged the foreman fills put a discharge slip and
sends him to the timekeeper with this slip. The timekeeper calculates all the
dues payable to him and passes them on to the pay master who prepares a
voucher and arranges for the payment by cheque or in cash. The timekeeper
updates his records on the employee record card.
In case of any increase in the rate of pay for any individual or in general
a change of rate, the pay-slip is made out by the superintendent. The
company may use the standard printed forms for record-keeping available
in the market. Sometimes big companies may get their own standard forms
printed for use under the banner of the particular project.
PAYROLLS AND RECORDS
In big construction sites in order to keep track of men, materials, equipment

used and payments to be made, it becomes necessary to follow a certain
systematic way of recording these details.
Payrolls and records involve the foreman's daily time report, the daily
time record, the timekeeper's checking card, the timekeeper's payroll report,
and the withholding statements.
The foreman fills out the daily time report where he shows the work done
by each man, the materials used and the item of work done. This report is
checked against the daily time record which is maintained by the timekeeper,
as the men enter and leave the site, using a time clock or card system. From
the daily time report the pay-master prepares the payroll subdivision sheets
and the weekly cost report.
The weekly payroll sheet is prepared in duplicate where wages, deduc-
tions, straight time engaged and overtime or premium time of work are also
recorded. Other relevant information like transfer to other payrolls, re-
employment, or notice of discharge are also entered in these sheets. As a
general rule these payroll sheets need the approval of the superintendent
who sends them back to the timekeeper who sends the original to the main
office retaining a copy in his office.
The subcontractors engaged in the work are also supposed to maintain
similar records for men, material and equipment, and submit the same to the
timekeeper who prepares a daily log to be approved by the superintendent.
Copies of this report are also sent to the RE./C.O.W. and the head office.
The receipts signed by men after receiving their weekly pay packets are
maintained in a file in the site office. Tax withholding statements are
submitted by the contractor usually in the head office from the consolidated
record and a copy of the same is submitted in the office of the District Income
Tax Oficer/Director.
PURCHASE AND DELIVERY OF CONSTRUCTION

MATERIALS AND EQUIPMENT
For purchasing materials or equipment, some form of purchase order is to

be issued from the project managerfs/or superintendent's office. Normal

progrciss of construction is possible only when there is a steady flow of
materials timed as per the requirement and there is no piling of materials in
the work area for a good length of time. The order form is usually made in
triplicate. The original and first copy goes to the supplier who returns the
copy indicating his acceptance. The second copy is filled in the office for
follow-up action-and for future reference.
The purchasing department/section is informed about the needs of the
project by requisitioning the required materials/equipment which is done
by a responsible site officer. These requisitions are kept in the office whereas
an order for the same is placed with the supplier by the purchase department
who actually makes the purchase.
When materials and equipment are delivered at the project site those are
accompanied with shipping order made by the supplier. People at site are
supposed to sign the delivery receipt. But this does not indicate acceptance
of the material or equipment but only acknowledges receipt. Final acceptance
is given after proper and thorough inspection by authorised personnel and
sometimes the final acceptance is given after the installation of the equipment
and its demonstration.
Timely delivery of material/equipment is very important but excessively
early delivery is also not desirable as that may cause repeated handling,
shifting and storage problems.
RECORDS OF COST AND PAYMENT
In order to control the cost of project it is of utmost importance that records

be maintained meticulously for all expenditures. Periodic checks on the
volume of work done and expenses incurred against the estimated cost of
items of work should be made to know the financial position of the project.
This checking also helps to provide reliable price information for future jobs
that may need to be quoted.
A good cost accounting system must present the expenditures made under
different headings and by different units of the project separately which
should include the expenses incurred by the units maintained by the
estimator, thg engineer, the accountant, the superintendent and others so as
to work out the proportional overheads required by each of these units. On
this basis, the reallocation of expenses could be done for the sake of efficiency.
In a cost plus contract, the owner prepares a budget which is controlled
by an architect or an engineer. The record of changes are also maintained to
check the estimated cost of the project. In a lump sum contract, it is in the
interest of the contractor to maintain the records of cost so as to control the
job expenses.
If the work involved in a particular item increases, it is labelled as extra

work and in case the volume of an item decreases it is labelled as a credit
memorandum. These are all kept in the job file for adjusting the money
available in the contract.
All vouchers or weekly pay roll sheets for the contractor's own men,
subcontractor's men and vouchers for materials are the records for the
expenditure made. These are transferred to a weekly cost report from which
a monthly cost report is prepared and is kept in the job file.
PERCENTAGE COMPLETION REPORT

In order to prepare the cost report, the estimating section witl-, the help of
contractor's engineer prepares the percentage of completion for each item of
work. From such updated cost figures the estimate of 'amount to complete'
and the 'final estimated cost' are compared to the working estimates and
extras. This comparison clearly reveals the 'over run' and 'under run1 which
aids the sound management of the progress of the project.
Again the values shown in the cost report can also be used to check the
progress schedule of the project and to establish a correct percentage of
completion. This percentage when applied to the total anticipated cost
should be near to the cost-to-date figure. In case of a mismatch between these
two figures one may be made alert to investigate the cause of difference
particularly when the cost becomes relatively high.
INSURANCE RECORD
The contractor has to maintain all records of action taken under the provision
of insurance of the contract and other state and central laws in connection
with insurance benefits for the labourers. The following records are essen-
tially maintained.
1. Workmen's compensation and employer's liability insurance in
accordance with applicable laws;
2. Comprehensive general liability insurance to cover both body and
property damage;
3. Comprehensive automobile liability insurance to cover both body and
property damage;
4. Fire insurance to cover materials, tools, equipment, supplies, tem-
porary and permanent structures.
PROJECT OFFICE REQUIREMENT

In a construction site the different people who work are the general
contractor, the subcontractors and the architect/engineer. Each of the organi-
sation needs adequate space to run their individual office which of course
depends on the number of people employed and the bulk of records to be

handled. Space for office has to be provided for the general contractor,
subcontractors and the architects. To maintain the smooth functioning of the
project activities these areas should be so earmarked that one is easily
accessible from the other. At the same time there should be some sort of
isolation so that unnecessary interference of daily work is intelligently
avoided.
In the construction site, there are some activities which go together
simultaneously while there are others where one follows the other. If different
agents or subcontractors are engaged for different items of work the space
planning may be done accordingly so that the same space may be used by
different agents at different periods of construction.
The separate organisational groups as mentioned may all be housed under
one roof or in separate buildings depending upon which arrangement is best
suited for a particular project. If all are housed in one building each of the
offices should have a separate entrance and the office space distinctly
separated out from others.
The resident engineer or clerk-of-works who is the agent of the architects
are to maintain the records of drawings and revisions, specifications and
revisions, correspondences, actions of committees, notes on meetings and
conferences, inspection reports, control surveys and construction progress
information. The general contractor has to maintain records of men and
material employed, datewise progress planning of items of jobs to be
executed, materials, equipment and men to be employed for the job element,
records of cost of labour material, the record of subcontractors employed,
individual progress of their jobs, etc. While the subcontractor is to maintain
almost all records maintained by the general contractor, the scale is smaller
when compared to the general contractor as he is responsible for only that
portion of job awarded to him.
In order to have an updated knowledge of the progress of work, the
schedule of work to be maintained, hurdles and hindrances to be overcome,
meetings are often required to be held at site. In order to fix guidelines to be
followed and the details to be drawn, these meetings are needed frequently
at the beginning. When the progress gears up and people are highly busy in
their own activities, frequent meetings are not required but as a routine there
should be one meeting every fortnight or a month where people may discuss,
exchange their views and adopt measures for the smooth running of the
project.
The meetings also serve the purpose of fixing responsibility for the
acceptance of materials and workmanship, enforcing quality control, etc.
The personnel involved iriclude key individuals from the general contractor's
organisation, representatives from the architects or engineers and sometimes
56 Construction Management and PIanning
the client also. The report on the job meeting is prepared in the contractor's
site office and is circulated to all people concerned with the work. A file is
maintained to keep the reports of the meeting for ready reference in future.
SAFETY
If the contractor works in an orderly and disciplined manner he can easily

realise many benefits. He can save a lot of money because of reduced cost of
insurance, labour and field operations. Thus he can quote a more competitive
price compared to others and chances of getting the job are better. But he is
to be very vigilant on construction safety which he is to undertake himself.
Dependence on others is not that effective and generally found to be costlier.
Depending on the volume of work to be handled and the value of the job
undertaken, the direct and indirect costs associated with construction acci-
dents total well over a few lakhs of rupees per annum. This includes the
direct cost of insurance premiums, direct costs of emergency medical benefit,
loss due to payment of full wages to the injured worker,,expensivecorrective
action, repair and replacement of damaged work and equipment, cost of
training for new recruits and replacement of old trained personnel. The more
the arrangement of safety measures adopted at site the more sense of security
comes to the minds of all concerned and the reputation of the contractor runs
high. Prevention of accident in construction is largely a matter of education,
vigilance and co-operation by everyone involved in the project.
CHANGES IN CONTRACT
Changes in contract are quite normal and natural in the process of construc-
tion. Changes may be initiated by the client by incorporating minor changes
of the plan, changes in design may also be found essential for the improve-
ment of the design or even changes in specifications may be entertained for
the general improvement of the job.
A procedure is to be followed for regularising these matters of changes.
The resident engineer or clerk-of-works should logically be the person to
maintain records of these changes. The contract period should also be given
due importance. No change in the contract period should be entertained
though changes as mentioned are required to be incorporated. All parties of
the original contract should sign the change order in person or by authorised
agents so that the changes become part of the contract.
DISPUTES AND STOPPAGES
The general contractor and subcontractors enter into agreement with the
Trade and Crafts Union whom they are going to employ. As such if contracts
Construction Organisation and Superirttendence 57
are negotiated at local level their terms will vary but basic;ally all tlhese
agreements deal with the wage rates, working conditions and time limit for
such settlements. In case of any dispute the superintendent may help in
arbitration. Labour peace means more profitable job for all.
The most common cause of dispute are wages and jurisdiction. Each
agreement related to the wages should be clear without any ambiguity.
Jurisdictional disputes are clashes between trades, each of which claims the
right to do the same work. The contract agreement sklould be made cqptal
clear in this respect so that chances of misundcerstandir~gmay n~ot arise at all.
3 - - . . -. -.conait
--.
A strike is basically a test of strength which aoes nor mean that ions
3 ! C
are so worse that the employer and the employee cannot go together. It: has
now become a sort of a prestige issue induced by the political leaders that
the labourers go on strike only to show their existence. The employer is to
understand this psychology and prepare themselves beforehand so thalt he
knows when and how they should allow some indulgence without causing
loss of money and time on the overall project. There are certain matters w hich
are the joint responsibility of the employer and employee, e.g;. the gerleral
working conditions, job discipline, seniority, Lmion replresentation, pay :;tale
and overtime rates, insurance and other frlnge benefits. Sometunes; re-
negotiation has to be started before the lapse of the time period for which
the agreement was made due to the mid-term announcement of certain
changes in wages, pattern of wages and fringe benefits by the ruling partv
or the government running the country. Unfortunately the whole thing -
be one-sided, i.e. there may not be any extra benefit given to the contra
though these are announced for the labourers. The contractor has to undc u
lot of tension to complete such projects lest the project runs at a loss.
Whenever a dispute does arise the contractor has to see that it does not
lead to the stoppage of work. At first a meeting u
is held between the
superintendent and the union leader. Many a:greemenits provide for arbitra-
tion and state specifically that work should crmtinue cluring this process. A
- a 2 -- -.-I-
complete record of all grievances and of all acuvrl mated thereto shoulcAbe
recorded and referred for future negotiations and agreements.
-- 3ANISATION CHART OF A SMALL CONSTRUCTION COMPANY
rpporHng s1
commercia
Chief eng
I Supparting staff
teck~nical
I
L
tident engir
Site I
t engineer
e Ill
I
nior engine
civil
Junior en$
,electric I Junior I
mecp
1
I Junior
, as
ior enginee
.. . leering
.nt
Constmction Organ1isation an1d Superinr
)ATION C I F A ME ONSTRU
3
Board of
directors
aging
1
tnager
lance
Marketing Manager
manager purchase
Manc
techr
I
Regional neglonal Regional
manager II manager II
1 ~:
r;[ I
Reside!nt engr. Reside?ntengr.
te 11
?ntengr.
Jr. engr. (c .
.#, Y. ,y. Ul . Ul lyl
(electrica (mechanic
I
jineering jineering
I
$neering
sstt. 1 sstt. 2 lSStt. 3
ORGANISATION CHART OF A LARGE CONSTRUCTION COMPANY ui
o
Board of directors
a
5
I
[ I t
I Director company affairs I
Director financial I
Director commercial 3
5
]
-
5
k
stocks
Company secretary Manager contracts

%3
(D
5
-L
P,
3
I Manager construction Manager design Manager MIS
I 5
I I 5'
Manager national operation Manager international operation fa
Manager bridge division Manager transmission Manager ports division
I Regional manager l I I Regional manager ll I I Regional manager Ill I

I
1 - 1~esidentengineer site II I 1 Resident engr. site Ill
I
I
Site engineer civil I r Site engineer electrical I
I
I
I
Site engineer mech. 1
I I
Junior engineer 2 Junior engineer 3
I
Engineering assistant 1 I I
Engineering assistant 2
I .
Engineering assistant 3
Constnrction.Organisationand Superintendence 61
EXERCISES
4.1 What is an organisation chart? How does it help smooth functioning of a
company?
4.2 It is said that delegation of responsibility and divisions of work help the
organisation to function better. Explain.
4.3 Discuss how the total manpower requirement of companies of different sizes
should be divided among the technical and non-technical heads so that the
company could run smoothly.
4.4 What do you understand by 'Decentralisation'? Why is it found to be
necessary? Do you think that the performance of a company improves by
decentralization?
4.5 What is the basic difference between construction supervision and construction
superintendence? Write down the different headings for which detailed super-
intendence will be necessary.
4.6 What is the procedure to be followed for hiring and discharging of personnel
in a construction site? What is the general information required to be known
about the person to be hired?
4.7 What are the items to be recorded in preparing pay rolls and records?
4.8 Discuss the procedure to be adopted for the purchase and delivery of
construction materials and equipment.
4.9 Suggest a rational .method of keeping records of cost and payment in a
construction site.
4.10 What is meant by 'percentage completion report'? Why is it made? How does
it help superintendence of construction work?
4.11 Make a list of the insurances to be maintained in a construction site.
4.12 Write down the requirements of a project office. How should the office be
planned in order to have optimum functions?
4.13 Write short notes on :
(i) Safety, (ii) Changes in contract, (iii) Disputes and stoppages.
Operation
Many of the civil engineering problems are ~ a s e deither upon classical

theories or on empirical observations. For example, a beam design is derived
from mechanics and the gravity flow in a pipe is derived from empirical
observations. IOn the c)ther hand, a n unber of Iconstruction management
probleims are biased upo~nchance happening, i.e. Ixobability. For example, a
----.-
consrmction ..
manager ..rhough much concernea about problems like break-
1 1
down of a machine or the completion date of a project c,annot predict the

incidm~t exactly. However, the construction manager may resort to prob-
ability theories to find a workable solution to the problem. ~t- present, .
probability plays a considerable role in managerial decision malcing. In a
nutshell elementary statistics is discussed here to help the readers. Readers
a= encouraged to consult other statistics book for further referencle.
Probability is the chance that something will happen. Probabilities are
expressed in fractions or as decimals. A zero probability of an event Iindicates
no possibilities of the event whereas unity indicates definite OCculrcIi~cur .--n,.
the event.
Probability theory is based on the follc ioms :
1. The probability (P)of an event (L, V C L--... U ~ l\IIE))
ID~ ~ ~ is a L L W ~ L U C ~
/
1 0 and 1.C
I P(E) I1.0
2. 111~ ~ L U H of all vruvdvurles of all mutually m ~ u s l v e
I
ourcomes ror a
$ven evcmt equals to one.
-,_ rarron ~nalysis
and aransrrcs oa
3. The 1xobability of either of two mutually exclusive events occurring

is eai
_lualto the sum of the probabilities of each of the two events.
4.
. The pI o~a~lllr oryw o indepenaenr events occurring s~mummeul
is eq ual to thle produc:t of the probabil he two iindepmdlent
evenits.
- . - - -. - . -
L (
f i e expected v a lie
/. .. .. . . 4~ .-I
m m a even slruation in wlucn pro~abilitiescan De assigned or assumed.
aes
~ (EV) is; the weil~ h t e davcerage of idl possible outco~
where Pi= independent probability for event i,, Oi= oui:come for event if the
event actually occurs, and i = l,2,3, .. ., rn.
Example 5.1 A building con:tractor fr.om his record discovers thlat in the last
200 slab castings his mixer machine! went wrong 21 times. 1h r i n g e!a&
L--akdown he had to pay OIL
'UlC
- d v c l a g about Rs 2,500/- for i d1-r 1-La... A
lauvul. fi
.
standby mixer machine if hired on the day of slab casting would cost I~
abcjut Rs ZOO/- per day what should be the course of action of the contracltor?
--
Solution:
Probability lown is about 21/200
Expected lobJ l j l v as ~ 0.105(2500- 200) - 1.a L=A.J".
The expected loss is greater than the mitigation expense of hiring the mixer
machine, i.e. Rs 200/-. Therefore, the contractor should hire the s t md b ~
mixer machine to make profit in the long run.
'ION
Dispersion indicates the extent to whicIh the inclividual values scatter a r omd ~
the average or central value in a grou:p of data..It is a way of expressing the
,Aabability
n tn of a variable attaining a, .-.~.t".i" value as a function of tkmt
LNLLLuI A L a L
variable. The distribution could be discrete or continuous. A discrete pr,ob-

ability is allowed to take only a limited number of values. For example, the
probability of completion of a job in the next month is discrete because th1ClC . f i e
could be only 30 possible values. On the other hancI, in the continu1OUS

probability distribution, the variable is permitted to take?onany1d u e within
a given range. In a sense, it is a discrete distribution thaC IL-m..-v c -.
L
IUIV
---.--"". :Ll-
VVJDI1v1r
, 1
outcomes all of which are very close to each other. For examplle, the aube
strength of MI5 concrete can be any value close to 15 ~ / m m ~ .
Dispersion is really the relative frequencies of occurrence of a finite

number of observations. The usefulness of it lies in the fact that many
physical observations tend to follow the same dispersion pattern in repeated
number of experiments. Firstly, the type of the dispersion is established.
Secondly, the parameters that measure the magnitude of the dispersion is
required to be estimated. The relative frequencies, i.e. the probabilities of the
events are now estimated. For example, the variation of concrete strengths
in a given mix is assumed as normally distributed. The standard deviation,
i.e. a parameter to measure the magnitude of dispersion, for MI5 concrete is
estimated as 3.5 in clause 14 in IS: 456. From the theories of normal
distribution (discussed later in the chapter) one may say that there is 6.1%
probability that the cube strength of a MI5 concrete is less than 14 ~ / m m ~ .
Such estimates can be made without doing a n experiment which requires
hundreds of cube tests.
There are various types of distributions identified. Normal or Gaussian
distribution is by far the most widely applicable. However, other distribu-
tions are also used in special cases. The distributions are related in the sense
that one type of pattern may converge to another type as the basic condition
changes. For example, a student distribution is applicable in an experiment
when the total number of people is small. As the number increases the
distribution pattern changes towards a normal distribution. When the
population reaches around 30, the student distribution changes to normal
distribution.
A list of distribution that is normally applied to construction management
problems are presented below.
~
Distribution
Discrete Continuous
Binomial Poisson Normal Student Chi-square Triangular Beta
Binomial distribution is widely used as a probability distribution of discrete

random variables. The process is applicable to the following situations:
1. Each trial has only two possible outcomes like yes/no or pass/fail.
2. The probability of success remains fixed over time.
3. The trials are statistically independent, i.e. the outcome of one trial
has no effect on other trials.
Probability of r successes in n trials =

n! r n- r
r!(n-r)!
where p = probability of success, q = probability of failure, i.e. 1 - p, r = num-
ber of success required, and n =number of trials to be undertaken.
Operation Analysis and Statistics fir;
Example 5.2 A labour inspector is going to visit 6 sites and wants to k

the probability of getting exactly 3 favourable reports from the visits.
data yield that 8 out of 10 such visits produce favourable resu
Solution:
Probability of 3 favourable reports out of 6 visits
A cumulative binomial distribution table is available'in many handbsooks

to facilitate calculations.
Example 5.3 A sample of 20 items is drawn from an inventory of which

is defective. Find the probability that the sample contains 1. 4 or mol
less than 2,3. exactly 5 and 4. no defectives.
Solution:
From the table of cbmulative binomial distribution
\
Probabilities:
=1- 0.9612 = 0.0388

Poisson distribution is used in several management problems. Particularly,
queuing problems are solved with ,the help of Poisson distribution. The
process is applicable10the following situations:
1. The probability of one event in a second is small and is constant
2. The probability of two events taking place in a second is infin_.-_,
small, i.e. zero.
3. The events are statistically independent of each other.
..
The probability of exactly x occurrence in a Po~ssond l ~ t ~ - l t ~ ~ t l o
calculated as
where h = mean of the distribution.

Example 5.4 In a construction site, the contractor requests on the average 5

times a day to the owner's engineers to check works for approval. What is
the probability that the contractor shall request at least 3 times on each day?
Solution:
Probability of three requests a day =1 - 0.26511 = 0.7348!

The normal distribution or the Gaussian distribution is the mosr wiaely
used distribution in practice. Normal distribution has the following charac-
teristics:
1. The curve has a single peak.
2. It is bell-shaped.
3. The distribution is symmetrical around a vertical line erected at mean.
4. The two tails of the normal probability distribution extend indefinitely '
and is asymptotic with the horizontal axis.

The normal distribution can be measured using the mean and standard
deviation.
,cxi
Mean=- and standard
--
n
The probability density function of n stribution is
where z-
d
The table illustrating the area under the normal curve between the left
hand tail and any point to the right of mean is pesented in the Appendix I.
An example is presented to show the use of normal distribution table.
Example 5.5 Historical records in a group of bank accounts indicate that

the mean amount per account is Rs 5,000/- with a standard deviation of
Rs 1,000/-. What is the probability that an account drawn at random will
have a balance more than Rs 7,000/-?
d Statistic
prom tne appenauc 1, probability is U.Y//L

Therefore, the probability that th~ ! shall beI more th loo/-
is 1 - 0.97725= 0.02275.
Beta distribution is another contirlUvUJ ulstribution. It is especially useful
when the variable represents a fr,action olf some cmtity. In construction
management problems, a beta distrilmtion is used in time estimates required
to be made for PEFT analvsis.
Triangular distribution i s also a continuous distribution. It has an ad-
vantage of spec* ring higl:lest, lowest and mean value. In addition, the
--.
distribution need nor L
--c
ue- symmetrical at a vertical axis drawn at the mean.
Triangular distribution, in construction management, is used in specdying
the probability distribution of variables in Monte Carlo's simulation.
SAMPLING
Sampling theory is a D L U U ~ of relationships existing vcrvvnll a population

and samples drawn from the population. It is useful in the estimation of
unknown statistical parameters of a population from a knowledge of
correspondingsample statistics. In order that conclusions of sampling theory
and statistical inference be valid samples must be chosen so as to be
representative of a population. One way in which a representative sample
may be obtained is by a process called random sampling in which samples
we chosen such that each member of the population has an equal probability
F being selected.
Sampling is widely used in the management practice including construc-
tion. Most methods of sampling assume that samples are chosen at random
.and the population have a normal distribution. Statistically speaking, one is
rarely certain that these assumptions are perfectly satisfied. In practice, most
of the large set of physical, chemical or financial observations are at least
approximately normally distributed and it is reasonably easy to select
samples more or less randomly with the help of random number tables
available in mathematical handbooks or with random number gener~torsin
most of the computers.
The two main branches of statistical inference are:
1. Estimation ()f unknown population p rs like m.em fronI the
statistic derived from the sample.
2. Test of hypo)thesis th.at the st,atistic balsed on samples clrawn from a
population are not sigmficantly djifferent :from thce population
parameters.
The standard deviation of a sampling distribution1of a given statistic is

called the standard error. For example, the standard dthiation of the means
of all possible samples of the same size drawn from a population is called
the standard error of the mean. Standard error provides an idea about the
reliability of a sample. The greater is the standard error the greater will be
the departure of actual distribution from the expected one.
The probability of making a mistake by rejecting a statistic derived from
a sample is called the level of significance. For example, at 5% level of
sigruficance, one will expect that the probability of making a mistake in
rejecting the outcome is 5%. In other words, a decision based upon the
sample is correct 95 times out of 100 at 5% level of significance.
The critical region is the region which correspond to the predetermined
level of significance. The critical region may be one tailed or two tailed. When
the sample statistic is required to be within a range around the mean, i.e.
within p - Zo? to p + Zo? as in Fig. 5.1 the two tailed test is required. When
Fig. 5.1 Normal distribution-curve
the sample statistic is required to be higher or lower up to a range from mean,

i.e. within p fZojgone tailed test is required. In practice, the confidence limit
is generally assumed as one of the following I%, 5% or 10%. The critical
values of Z is presented in Table 5.1.
Table 5.1 Critical value of Z
a, level of significance 1% 5% 10%

Z critical values for one + 2.33 or + 1.645 or + 1.28 or
tailed tests -2.33 - 1.645 - 1.28
Z critical values for two + 2.58 and + 1.96 and + 1.645 and
tailed tests - 2.58 - 1.96 - 1.645
The sample.size required to estimate about a normally distributed statistic
of the population can be estimated by:
= (3yJ
where n = no. of samples, Zd = critical value at the a level of significance,
Operation Anarysrs and Statistics 69
o = standard deviation of population, and h = confidence interval, i.ce. the

, and p +.Z
distance between p -:Z :,
Example 5.6 A supplier sends steel plates in a huge quantity to a contractor.

The first batch was exhaustively examined for thickness and gave a standard
deviation of 1.80. The contractor feels that the know1!edge of Imean wiithina
range of 0.5 to its true value for a probability of 95Oh would I>esatisfactory.
1
Determine the size of sample.

Solution:
In case of small sample, student or t-distribution m appropriate in

*.
lieu of normal distribution and the sample size can be expressed by:
where n = sample size, t&, - =critical value at a level of sigruficance and

---
n - 1 degrees of freedom, o = standard deviation of population. and h =- LWL-
fidence interval.
The student distribution is suitable for small population, i.cc. less than .30.
. ..
Under such a circumstance, the distribution curve varies witn tne number
of population. Therefore, tables for the student distributiorI indicat:e the
number of population, i.e. degree of freedom. A table is presentced in
Appendix 11.
Example 5.7 HotY many readings of a sighting should be taken

theodolite if it is L---A
rtvyeu aso specify the sighting within k0.5" with 77m
confidence. It is estimated from previous trial that the standard deviation of
the reading is expected to be in the neighbourhood of 0.6".
Solution:
By trial and error f e in Appendix 11, n shoulc

In many business applications, one is required to ascertain the freq~
of events falling in specified categories. For example in quality contra11one
can count the number of defectives produced by a machine during a artain
period. In these situations, where measurements are made bv frequenLCV in
each category Chi-square test is applied.
The Chi-square, denoted by the letter X2 is frequently use(1 in testi
70 Construction Management and Pi,. ,, ,, ..,
hypothesis concerning thce differenlce between a set of observed freqiuencies
..
of a sample and a corresponding set of expected or theoretical frequencies.
,
where x2 = Chi-square, Oi= observed or actual frequency, and E;i = cor-

responding expected frequency.
The test is based on frequencies as opposed to 7 mtu ,.A 4 ... L
4,"C"
r Lcam w l t c l r utr:
mean and standard deviation is required to be known. The test is suitable

for drawing inferences and testing hypothesis only and is not useful for
bstimation as possible'in Z and t tests. test can be awwlied without knowing
I I
the distribution. The test is depen the degxees of frt "he test
assumes that observations are in( ~t of the previou:j outcom~ e sand
.- -1. -..13
collected on random basis. The observation numbers snvula 1D_e_ large
I---_
(about
50) and each frequency class or cell of observation should have at least 5
observations. The test is really a one-tail significance test and is dependent
upon the degrees of freedom, i.e. the numbers of frequency r ~ l l c
Rejection
jesion(a)
x2
Fig. 5.2 x frequenc!/ diagram
Example 5.8 A real estate developer, builds an a partrnent in three sizes

namely three bedrooms, two bedrooms and one bed room fla ts. Accorlding to
the thumb rule in the industry, the flats sell in the ratio of ?r : 5 : 2 . $;ales in
the last project show that 40 numbers, 45 numbers and 15 nlumbers :respec-
tively of different sizes have been sold quite easily. The finn has to decide
what should be the proportion of the flats in the ne!xtprojec
Solution:
.... -.J1. nvlas
The question is whether the thumb rule mennonea -1 3 - -- _
gvvu m rrlesce cases.
-.
--. -
Accepting the thumb rule as valid,. the expf ?ctednur flats to

be sold quite easily:
Operation Analysis and Statistics 71
Three bedrooms = x 100 = 30 nos.

3+5+2
5
Two bedrooms = -x 100 = 50 nos.
10
One bedroom = x 100 = 20 nos.
10
Calculating,
Sale
Class 0- E (0- E ) ~
Observed 0 Expected E E
3 bedroom 40 30 10 3.33
2 bedroom 45 50 -5 0.50
1 bedroom 15 20 5 1.25
100 100 X 2 = 5.08
Degrees of freedom n - 1 = 2.
- I (i.e., probability that X2 value will be exceeded

At 0.05 level of significance
5% of the times). Critical xL at 2 degrees of freedom as shown in Appen'dix
III as 5.99 which is greater than computed x2 of 5.083. Therefore, it falls; i n
the acceptance region. Thus the original hypothesis, i.e. the thumb rule nf -- b
the industry is accepted as applicable to these situation. Therefore, the

proportion of flats in the next project should follow the industry thumb rule.
REGRESSION AND CORRELATION

The regression analysis deals with the derivation of an appropriate functio:nal
relationship between variables. It is a mathematical measure expressing -&L UL~
average relationship between two or more variables in terms of the original

units of the data. The regression analysis can be classified into simple an d
multiple, linear and nonlinear, total and partial. Regression analysis is vc-,
=rV
popular among practising managers. It deals with the input and output data
eliminating the need for investigations of cause and action relationship.
Regression analysis helps in establishing a functional relationship between
several variables. Once this is established predictions or forecasting can
made.
The correlation is a coefficient describing the relationship between t ~,.
variables. It is mainly used for testing and verification whereas the regression
analysis is an absolute measure described by an equation which can be
mathematically treated, like maxima and minima, for additional informatien
In practice, regression and correlation are intimately used to deitermine l
relationship between variables.
IL ~ v r r s ~ r u ~ . [marraoerrrerrr
lori arro Plannina
A linear regr wn in Fig;. 5.3. A P )f the go(

fit of the line is ~ ~ U V ~ U C LU J r~l l r 1 r a 3 r wuare method. Of all I;-," ..-..
U N Z ~ LIVVLVALIILQL-
3,
Fig. 5.3 I 4 linear regression lintz in least st
in^ tl, LLVSII

L,
set 01 ,6 A,,+"
u a L a
c+
*
;
.
,
.
YVYtY, the lin
- -.
I5 utr property <
Dl+D I$+ ...+ n and is called bc 5 line in the least

square method.
The II,,,& ,
C ~ ~ ~
,
L UUCUC ULC ~VVIUAULLQLU~~
.,..IULC
& .-..-.I. *
~ C LVL VUIILL~ ( X I , Y1), ( ~ 2 1, 21,
Las the ec
where the cons4tants a. a~ n dal arc olving si 3usly the

equatic)ns
Y=aoNi
The co
Example 5.9 A manager wants to find a e to fix s alaries. 14 sample

data collected from the work site is prese
"realrs of service ,T7, 4, " C 0 ,
' in
Incc)me (in h~mdreds)

Operation Analysis and StatisticJ ,
What should be the salary of a person with 13 years of experience applied
for the job?
Solution:
The computations are:
The regression equation is Y = 2 + 0.75 X

The person with 13 years of experience should have a salary of Rs 1,175/-.
Correlation is a quantitative measure to determine the relationship be-
tween two or more sets of data. It varies from - 1 to + 1. The zero correlation
indicates no relationship. A positive 1 indicates that a change in one set of
data is perfectly matched by a change in the same direction of the other set
of data. Anegative 1 indicates a change in one set of data is perfectly matched
by a change in the other direction of the other set of data. Several quantitative
measures are proposed. One such method known as short computational
formula is presented:
NZXY-(ZX)(ZY)
r=
d [ z x2
~ - (Z w 2 j [ c~ y2- (z v 2 j
If the precise values of the variables are unavailable the data may be
ranked in groups and can be expressed as:
where D = difference between ranks of corresponding values of X and Y, and

N =number of pair of values (X, Y) in the data.
Example 5.10 In a construction site, the tensile strength between 8 mm
-
dia bars and 16 mm dia bars from different mills were tested and following
results were obtained.
Mill 1 2 3 4 5 6 7 8 9 1 0 1 1 1 2
8mmdia 65 63 67 64 66 64 70 66 68 67 69 71
16 mm dia 68 66 68 65 69 66 68' 65 71 67 68 70 .
(12)(54107)- (800)(811)
Correlation coefficient =
d[(12)(53418)- (800)~][(12)(54849)- (811)2
= 0.7027
The correlation coefficient is about 0.7 indicating moderately high correli
in tensile strength between 8 mm dia and 16 mm dia bars from the :
mill.
FORECASTING
Forecasting is an effort for prediction of a future event that might take place
from a number of possible outcomes. Forecasting always involves some
amount of judgement. However, forecasting depending upon the methodo-
logy can be divided into two types: judgemental and statistical.
In judgemental forecasts, the wisdom of the researcher or professional is
utilised. It is subjective in nature. Several methods namely delphi technique,
brain storming or opinion from panel of experts are such judgemental
forecasting techniques. These methods are normally used for forecasting
macrosystems with limited data and having a fair degree of uncertainty.
In case of micro systems and available historical data, statistical techniques
are suitable and this discussion would be limited to statistical forecasting
techniques. Several mathematical techniques like moving averages, exponen-
tial smoothing and regression are discussed in the following.
Averages that are updated as new information is receive( lerally
called the moving averages. Sometimes, weights are assigned lur eaclt ~ e r i o d
to take care of the trend. An example is presented in Table 5.
Table 5.2 Example of a moving average
Actual 3 monlth 4 month 3 mont

, Month Sales movu'8 moving
(000's) a v e r ae;e~ "*,A..".-
a v
weightt
moving av -
Jan 10
Feb 12 I
Mar 13
AP~ 16 11.67 12.17
May 19 13.67 12.75 14.33
June 23 16.00 15.00 17.00
July 26 19:33 17.75 20.50
A% 30 22.67 21.00 23.83
SP 28 26.33 24.50 27.50
Oct 18 28.00 26.75 28.33
Nov 16 25.33 25.50 23.33
Dec 14 20.67 23.00 18.67
In Table 5.2, the weighted average was calculated as

3S, + 2.5, + 53
6
where S1, S2and S3 are the sale figures for the last month, the month before
the last and two months before the last month respectively. After comparison,
one may say that the weighted averages have generated relatively better
forecasts. However, the exact weightings and the number of periods are
required to be developed empirically. In a moving average forecast, new data
as they come in replace the oldest data. The process requires a large number
of data generation and maintenance, and involves computational burden.
Exponential smoothing uses a single weight factor alpha (a)in weighted
average method. For example, an exponential smoothed forecast could be
Smoothed forecast = Sla+ (1-a)S2 for this month's sales.

where S1 and S2 are the sales figures for the last month and the prey
forecast of last month respectively. In the table 5.3, the computations for
forecast of the above sales figure shown in Table 5.2 are presented by
exponential smoothing. The a in this case is assumed as 0.7 from experimen-
Table 5.3 Computation for forecast of sales figures by exponentlal smoothing
Previous foreca Gmoothed

Actual Sales
of last month forecast
Id."
17.8
21.4
28.1
*The previous forecast of February is assumed as 11.
The forecast for February is therefore estimated by:

0.7 x 10 + 0.3 x 11
One may notice that the forecast estimated by exponential smoothing is
computationally easier and provides better results than moving averages.
However, the value of a is still required to be estimated empirically for better
Rebssion models discussed earlier are widely used for forecasting. Apart
from statistical techniques, casual forecasting models with sophisticated
tkhniques can also be successfully used for forecasting. For example,
76 ~;onsrnrct~on
Managemenr ana rrannrng
econo~ odels t h~t descril3e an ecc ystem th series of

3 . : - LL.. C-^-.,^ -1
equations nave been developea. The inpur vd~ueb.1.e. ult: U L I V U I ~ L I ~ C L O I S01
the system woulld be cornbined in the model to pro in future.
Such treatments are beyrond the scope of this text
DECISION THEORY
Most of the complex f~larlrl~erldl decisiorls me 1 1 ~ u twlrh

. some U.ncertain
future conditions. Under such circumstances, dlecision tlheory prtovides a
rational method for choice. The dlecision p:rocess generally irtvolves fc>ursteps:
1. The alternatives available r w ule ueclslu~l11
2. Identifyjn g the filture events that :may occ~
3. Identifying the pay-offs that may occur irI various; combinations of
decisions and future eyen1ts.
4. Taking a rational decision in the given situ =ti--
In the cases wh,ere the risk, i.k. the variability of the outcome, is known, the
princi~>lesof p~sobability can be utilised to take a rational decision. The case
---a:-.-
of prevell~lvt. -
lnaintenance is illustrated as an example.
f i e probllem concerns a large site vvhere co:;t records;indicate

- . . - -
that the 100 concrete vibrator nozzles in the site can be serviced for a set up
cost of Rs 50 ar~din addition Rs 2.50 labour cost for each if done on a mass
servictI basis w hereas the labour cost for service if done on individual basis
-- -
would cost Rs 3/- each.
Solu e past bc es is pres the follo
'ercent of nozzles
failed
average service 1ife of the1 100 noz

0.1 x 1 -t.0.15 x 2: + 0.25 x 3 + 0.30 : 5 month:
On the average, the monthly service cost for nozzles (if done on'as they
100
fail' basis) = -x 3 = Rs 89.55.
3.35
The expected number of nozzles requiring service at the end of each
month (if done in batches at the end of the month)
100 x 0.10 = 10
100 x 0.15 + 10 x 0.10 = 16
100 x 0.25 + 10 x 0.15 + 16 x 0.10 = 28.1 .
100 x 0.30 + 10 x 0.25 + 16 x 0.15 + 28.1 x 0.10 = 37.7
100 x 0.20 + 10 x 0.30 + 16 x 0.25 + 28.1 x 0.15 + 3 7 . 7 0.10
~ = 34.9
126.7
say, 127
Service cost for nozzles
Senrice at Setup No. of Variable Average total

month end cost Nozzle cost cost per month
Month 1 50 10 25 75
Month 2 50 26 65 57.50
Month 3 50 54.1 135.25 61.75
Month 4 50 91.8 229.50 69.87
Month 5 50 126.7 316.75 73.35
The table indicates that the least cost method would be to service all the
nozzles in every two months. The'as it fails' basis would cost about Rs 89.55
per month whereas the batch method of preventive maintenance in every
alternate month would cost Rs 57.50. The saving of Rs 32.05 per month is
thus obtained.
A decision process essentially involves the consideration of several pos-
sibilities. In other words, the process deals with the joint probabilities. Joint
probabilities of outcomes and corresponding monetary values are presented
in the graphical tree form and is popularly called decision trees. An example,
whether to build or not, a pilot plant for flyash bricks, is presented with the
help of Fig. 5.4.
In decision trees, probabilities estimated from subjective estimates or
historical records are assigned to each level of decision making. In Fig. 5.4,
three options (i.e. produce commercially, build pilot plant and wait or stop)
are available at the first level of decision making in block 1. At the second
level of decision making in block 2, two options are qvailable and proba-
bilities are assigned to each option. The outcome of each option (i.e. the
monetary values) are also presented. Thus the decision tree is prepared.
EV = Rs. 8,11,750
- Low Rs.
Fig. 5.4 Decision tree for a pilot plant
Expected values (EV) are estimated for each node. For e x a ~ ~ l yL~ve ,a r rwue
5 is obtained by:
0.7 x RS 12,25,000 =0.3(- Rs 1,52,500) = Rs 8,11,750/-.
The EV at node 2 is estimated by
0.8 x Rs 10,18,375 + 0.2 x 0 = Rs 8,14,700/-
The expected value of the information from the ~ i l oplan1
t 13 ~ s ~ l l a t bv:
ed
ode (5) - EV at node (2) 14,700 -I
= KS ~,350/-
The low expected benefit of Rs 2,950/- from the operation of
plant would probably discourage the decision maker to establish
plant.
3N AND TIME S
The motion and time studies are made by an observer using a stopwatch.
The time period of individual tasks are recorded as they are o b s e ~ e dFor
.
example an earth hauling operation may involve the following. The truck is
loaded. The truck travels to the dump site. The truck waits for the dumping
operation. The earth is dumped. The truck returns to the loading site. Thc
truck waits for the loading operation. The truck is loaded again and the cycle
continues. Each of these operations tak:es a time which are noted in tht
motion and time studies. A typic:a1 time s tudy observation sheet is presentec
in Table 5.4.
Operation Analysis ana ararrs
Table 5.4 Motion and time study

Project: Example site
Operation: Mechanised earth transport
Truck no: 1 Driver no: 1
Shovel no: 1 Operator no: 1
Element Truck Load Haul Time Dump Tirne J ITime

Cycle Time Waiting Time Waiting Time Waiting Time vvalnng lime -- "
Waitinn
. The number of cycles required for the observation depend upon the
variability! i.e. distribution of the operation times. This is a ratndom sam ~ l i n g
problem and the principles discussed earlier can tje used to detemline the
> -
required number of observations.The time duration of most of the operations
are assumed to be normally (i.e. Gaussian) distributed. The equations
presented earlier can be conveniently used to estimate the observation
numbers. The statistics (i.e. mean, standard deviatlulLJ,cLL.l
:r\..r -Cn
ul ULcactivity
durations are used to estimate the time duration of the work. Such estimates
are required for activity durations in network analysis. The total delay or
waiting in the system operation provides an idea about the loss incurred for
the delay. A delay may be caused by the human or machine inefficiency or
by a fault in the system. Motion and time studies identify the cause of the
delay and help to mitigate the problem. If the delay is inordinate, further
machine or manpower can be deployed to reduce the time durations. The
theory of queues presented elsewhere in this text are normally used to
determine the optimum number of facilities. Motion and time studies would
generate the necessary input data for such estimate
ACTIVITY SAMPLING
Application of time and motion studies in the construction site could become
quite expensive. Morever, trained manpower is required to conduct these
studies. A simpler method, by means of which unskilled practitioners can
monitor productive efficiency, is explained in the following:
A field count provides a preliminary information before carrying out a
full activity sampling exercise. For example, a site engineer may test the
80 Consrmction Management and ~ l s n.,,,,
n i'n
3n
'U,
overall efficiency of .the si.teby casually rec,ording tklose lab0urs working and
those not working.
Number ob: :tive
Activity rating = -x10
Total numb red
ASSumlng that the number of workers active is normally distributed, one
may usc statistical sampling theory to estimate the number vations
requireci with a given confidence limit and level of sigrufican ~tioned:
where N = Number of observations requirea, L = vatue o~tainedfrom lame

5.1, P = Percentage of activity, and L = Confidence limit.
In order to carry out an activity sampling, the following steps arc! taken:
- - .l _
1. A preliminary survey to obtain basic information and the design or me C
data collection sheet.

Estimation of the number of observzltions rec >mthe tl
statistical sampling as mentioned b~lulc..$*..A
plannedI time table for o >ntimes factory

rork, these times are nor losen rar e work
. ... - - .-- - ..--
arrerns rend to be regular. m consmcnon
-U_-_ l_
WOTK, acuvities by narure
c
: .--L
~ke a ranciom timeI to compllete and thus the ( om cant)etaken

t regular intervals1. Howev'er, care sihould b~:taken tc) avoid btias. For
.--_il-
<ample, .
.
early -- -
morning anaJ lare
1 r .
arrernoon - .
I... . . may
oDservarions
- .
induce
1 . . - ~ - - - -
bias due to comnnenceme.nt or connpletion of the w cork day.

bservatit)ns are IY!corded in the dalL a collect:ion sheet:.An example of
*-.
le data collection sheet is presented in Tabb
-
Observer
ble 5.5 Data colle!ction she
Date
-- -
Observe Time Vorker

Hour Min A B C V BC MP
' 0 0 --
--
-.
- I I uA
Note: B1N = Brick work, BCI = Carryi~
~gbricks,
I
paring mc
I
Rest-
g, I = Idle,, A = Abstmt.
Operation Anarysrs ana srarrsrra
5. From the records, one may see the activities on which an undesiirable
amount of time is spent so that corrective actions may be takcbn to
avoid such time loss.
Example 5.12 A preliminary survey indicates that 20% of the time of a L "
of workers is spent idly. Estimate the total number of observations required
to determine the proportion of idle time within* 5% with 95% confidence
limit.
Solufion:
MULTIPLE ACTIVITY CHART
Once the average time period of each activity is determined by a work study
or activity samplings, improvement is attempted with the help of multiple
activity charts. An example is presented in the following to explain the
process.
In this case, concreting is undergoing in a congested multi-storeyed site.
~ ~ g r e ~ aare
t eloaded
s manually in the concrete mixing machine which pours
the concrete in a hoist that lifts it to the desired floor. The time period of each
activity is shown:
Aggregate loading to mixer : 4 min
Mixing and discharge to hoist bucket : 1min
Lifting, discharge and return of the hoist : 1 min
The activities are arranged in the multiple activity chart in Fig. 5.5 an(
cycle time of each activity is estimated. The concrete production cost ol
existing method is estimated from given data as shown.
Each machine load generates 0.2 cu m of concrete.
Hoist cycle: 5 mins
8 x 6 0 ~ 0 . 2 = ~ ~ ~
Average concrete production in an &hour shift =
5
Cost:
Mixer machine with fuel/day W/&0/- per day
Hoist with electricity cost/day Rs 350/- per day
Labour charge for 16 cu m conc: Rs 75 x 16 Rs 1200/- per day
Rs loo/- ver dav
Rs 2050/- per day
2050
Cost of production without materials = Rs -
16
= Rs 128112 per cu m
1 2 3 4 5 6 7 a 9 10 11 12 13 14 15
Duration
4 b b
Aggregate loadlng to mixer

- 5 mins --
-
4 b
C--*
Mixing ar le to hoist bucket

4 - 5 mins -- b
* ---,
Lmlng, a1 ~dreturn
5 mins
-
Aggregate loading to Mixer no. 1
-.
-,
-.
+ .-
Mlxlng ana olscnarge to hoist bucket by no. i c--.
-- - -.
Aggregate loading to Mixer no -. 4
- -.
Mixing ar le to hoist Bucket by no. 2 4
Lifting, discharge ari d return

I
ia. 5.5 MIJlnple acrlvlry cnan

The multiple activity chart shows an idle time of 4 minutes for hoist
between operations.
4
Idle time of hoist = - x 100 = 80'
5
The idle time can be reduced by emp:loying another concrete Imixer
machine. The proposed alternative is also shown hn the mtlltiple ac:tivity
chart.
4
Idle time of hoist for the proposed alternative = - x 100 = 57.14%
7
Revised cost of production is presented as follows:
Hoist cycle ---
-7-1.75m Lins
4
8 x 6 0 ~ 0m .
Average concrete production in an 8 hour shift=
1.75
Cost:
Mixer machine with fuel/day Rs 4 er day
Hoist with electricity cost/day Rs 2 er day
Labour charge
- for 54.85 cu m conc.:
Rs 75 x 54.85 Rs 4113.75 per day
supervision Rs loo/- per day
Cost of production without materials = Rs 4963.75 54.85

= Rs 90.49 per day
-
Total Rs 4963.75 p---'---
In the revised production method, the cost is reduced by about

However, planning should be made to arrange for 54.85 cu m of concrt
casting days.
EXERCISES
5.1 A sample of 18 is drawn from a lot of which 30% are considered 'passed for
sale'. What is the probability in the sample of (a) 5 or fewe ' more
(c) exactly 8 are 'passed for sale'.

(Ans. (a) 0.5346, (b) 0.6673, (c) 0.811)
(Hints: Use binomial distributions)
5.2 One fifth per cent of the locks produced bjr a lock manufacturer turned
be defective due to a production error. The locks are supplied 1>ypackets;of 10.
Estimate the approximate number of packets containing (a) no defecbive (b)
one defective (c) two defective locks respectively in a consign ment of 1,00,000
packets.
(Ans. (a) 98,020, (b) 1960, (c) 20)
(Hints: Use Poisson distribution)
Construction Management and Planning
The mean weight of 500 steel windows in one lot is 151 kg and the standard
deviation is 15 kg. Assuming that the weights are normally distributed find
how many windows weigh (a) between 120 and 155 kg (b) more than 185 kg.
(Am. (a) 300, (b) 5)
The mean inside diameter of a sample of 200 washers produced by a machine
is 0.502 inches and the standard deviation is 0.005 inches. The specification
allows a maximum tolerance in the diameter of 0.496 to 0.508 inches, otherwise
the washers are considered defective. Assuming diameters are normally
distributed determine the percentage of defective washers produced by the
machine.
(Ans. 23%)
The mean lifetime of a sample of 100 fluorescent light tubes produced by a
company is computed to be 1570 hours with a standard deviation of 120 hours.
The company claims that the average life of the tubes produced by the
company is 1600 hours. Using the level of significance of 0.05 is the claim
acceptable?
(Ans. No)
A ceramic tile manufacturing company launched a heavy advertisement
campaign. Before the campaign the mean sales per week per shop was 140
boxes. After the campaign, a sample of 26 shops was taken and the mean sales
was found to be 147 boxes with standard deviation of 16. Can we consider the
advertisement effective?
(Ans. Yes)
An auction lot of a large number of ceramic tiles consists of four colours namely
red, orange, yellow and green mixed together. A sample of 12 tiles drawn at
random from the lot revealed 2 red, 5 orange, 4 yellow and 1 green tiles. Say
whether the hypothesis that the lot contains equal proportions of the differently
coloured tiles at 0.05 level of significance is correct or not.
(Ans. Yes)
The following table shows the ages and the daily earnings of expert furniture
carpenters. Find (a) the correlation coefficient between age and earnings.
Determine (b) the least square regression equation of age and earning.
Age (XI 56 42 72 36 63 47 55 49 38 42 68 60
Earnings (Y) 147 125 160 118 149 128 150 145 115 140 152 155
(Ans. (a) 0.8961, (b) Y = 80.78 + 1.138 X)
In an architectural plan competition, two judges were asked to rank 8
candidates A, B, C, D, E, F, G and H in order of their performances. The results
are presented in the following table. Find the coefficient of rank correlation and
decide how well the judges agreed in their choices.
Candidates A B C D E F G H
1st Judge 5 2 8 1 4 6 3 7
2nd Judge 4 5 7 3 2 8 1 6
(Ans. = 0.67))
5.10 A supplier has the sales figure as presented in the following table. Determine
the sales forecast by exponential smoothening(Use a = 0.7) for the month of
December. Assume beginning forecast as 3.0.
Month Actual sales Previous foreci
Jan 2.0
Feb 1.4 3.00
Mar 1.9 2.30
Apt- 1.9 1.67
May - 3.1 1.83
June 1.8 1.88
July 1.5 2.73
Aug 1.3 2.08
ST 2.2 1.67
Oct 2.7 1.41
Nov 2.0 1.96
Dec 1.3 2.48
(Ans. 2.14)
5.11 A construction company is planning its market strategy over the nexr n v e year
period. The planners assess various alternatives in both high growth and low
growth economic environments and estimate the profitability of the company
under different strategies as shown in the following table. Draw a decision tn.p
and advise the company.
Probabilities of growth
Alternatives
1. Use existing facilities only
2. Apply gradual expansion
3. Immediate expansion
High (0.8) Low (0.2)
12%
16%
18%
10%
9%
zero
1 Profitability.
(Ans. The effect of alternatives 2 and 3 is very close. Therefore, best decision
is to wait and thereafter take alternative 2 depending upon the economic
environment.)
5.12 An activity sampling study is taken to determine the performance of a cr,ane.
Four hundred observations were made and the records are as follows:
Operation No. of observations
Crane lifting or lowering load 1f
Crane moving to place of work f
Unloading or loading crane hooks C
Crane idle
(a) Determine the proportion of time the crane was
accuracy of the result. Ninety-five per cent confidence 1s requa.&-.
(b) If the accuracy required is f 2%, how many further observations are
needed?
(Ans. (a) 0.25,4.33%, (b) 1475 further observations)
5.13 In Fig. 5.5 if a third concrete mixer is introduced determine whe tuld
be economically beneficial.
I CHAPTER 6 1
Construction Practice 1
EARTH WORK AND EXCAVATION

Any new construction work involves some excavation for its foul7dation.
There are structures like canals, dams, spillways, barrages, arid embar~kments
where the earth work in excavation or filling or both forms a su~stantial
1
portion of the work. For structures like basement and tunnels, the excavated
earth may not be required fully or even partly for the required filling, and
hence this has to be disposed of. Thus in general earth work involves the
movement of a portion of earth's surface from one location to another and
the creation of the shape and condition as required and sometimes disposing
of the excavated material as spoils. A number of factors are to be considered
while deciding upon the type of excavating machinery to be used for the
purpose. In order to attain maximum efficiency one of the important factors
is the type of material to be handled which may be the top.soil, earth, rock,
muck and unclassified soil or a combination of the types mentioned.
Top soil supports the growth of trees and other vegetation, hence this
contains more moisture. The soil beneath the top is normally easier to handle.
The top soil when removed should be pi11ed for re use at thle same s ite or at
1
a different place.
Earth is the type of soil encountered btlLcauc u L L ~U ~>oil. Earth is used
for the construction of embankments, earthen dams, etc.
Rock is to be removed by drilling and blasting in a systematic I
The boulders which come out as a result of blasting are -- d- I -~- s u.useu I r r
embankments at a deeper place or may be used as stones for different
purposes.
Muck is defined as any soil having an excessive amount of water. This has
to be dried by spreading over a wide areaI under tihe sun before it c
used for any purpose.
WIIS[IUG~IUI~ Practice r 01
The type of earth needs to be classified since the types of machinery to be

used varies from one type to the other. Sometimes when these are mixed up
it becomes difficult to distinguish and hence it is kept unclassified. Therefore,
the soil may consist of anything from top soil to muck including rocks, and
the contractor has to quote and arrange for excavation intelligently.
As said earlier, e!xcavations are also required to be classified accordi
tl-ie purpo:;e of the work:
1. Stripping me!ans remc~ v aof l all materi,als up to a certairI level so that
the top exposed surfzice could act like a permanent emtm.nkrnent.
2. Road way en~avauvll
"n".,-G-.
where required, starts &.A- ll"lll
*he
LLLC! level of the
stripped of earth and ends at the level or grade as per the drawing.
3. Drainage excavation is the removal of material for the installation of
minor drainage structures such as culverts. Back filling for such cases
need a different type of material to be brought at site.
nnel excavation may deal with shaping a natural drainage for the
ariau-tment cf a better flow of water or channelising the flow to the
culv ert unde!r constnlction or may be finding out new routes of the
flow of wat:er for tihe benefit of the people like navigation and
.lrrrgation
. canals.
5. Bridge excavation may involve a large! amount r the
construction of pier, abutments, embmrdcmeniLa/ cLL. A rolve
work on soil of a variety of physical characteristics.
6. Borrow pits :%repits dug out order to collect soil for embankments
to bc? constructed at an adjacent place or at a different place. Since any
type! of soil rnay not 1be suitable for tht2 construction of Iembankrnent,
a b orrow pit may be :located q[uitefar jfrom the embanlunent site
I7
ox~dvdrionis also
_-L - - -.--..... - 3 r -
requlrea ror nousing the rounaation
-1. c - 1 .. or,-any structure
like buildings, sheds, water towers, 5;ilos, bunlkers and chimneys. In order to
Sometimes even formworks are not usea ror .

save material and labour this has to be done strictly as per drawings.
r
such foundations.
In order to maintain the channel of a waterway in rivers or to maintain
the capacity of reservoirs of dams dredging excavation is required where the
dredged material is removed bv vumping. These materials may be dumped
I
by the pipe network to improve or eblevate some marshy lands.

For selecting the type of Inachiner,y or equipment to be used for the earth
- -
work one has to know the depth of excavation and height to which the
excavated earth is to be lifted, how the lifted material should be disposed of,
' the distance of the site of excavation to the spoil bank, the type of hauling
unit to be used, the hauling length to be covered, special loading equipment
required, the type of soil to be excavated, the load supporting ability of
original ground and the load supporting ability of the material to be
excavated. The time available would also influence the choice of equipment.
EARTH MOVING AND EXCAVATING MACHINERY
Tractors
Tractors are used to pull and push loads. These are provided with arrange-
ments to mount accessories like shovels, rippers, bulldozer blades, hoes and
trenchers. Tractors are generally either the crawler or the wheel type. The
wheel type may have two or four wheels.
Crawler tractors are rated by the size or weight and power. These are
provided with a direct drive or a torque converter and a power shift drive.
Standard charts are provided with machines furnishing performance data.
These are run at a speed 2-8 kmph.
Wheel tractors could be run at a much higher speed, say, 30-50 krnph. The
higher the speed lesser the pulling effort. The two wheel type has got better
manouverability and traction, and less. rolling resistance compared to the
four-wheel type. The four-wheel type has also got certain advantages over
the two-wheel type. It has got better steering properties, less chance of
bounce on rough surface and higher working speed. It couId operate
independently when separated from the trailing unit. The wheel tractors are
also provided with performance data charts.
Bulldozer
It is a machine often used to mean any tractor, tracked or wheeled, on which
a blade is mounted. When the blade is mounted perpendicularly to the line
of travel, the machine is a bulldozer (Fig. 6.1). While if the blade is at an angle
to the direction of travel, it is known as an "angle dozer". Depending 011the
method of raising or lowering the blade mounted on the machine, the
bulldozer is calssified as cable-controlled or as hydraulically controlled.
These are used for clearing the land, construction sites, constructing tracks
for roads in new construction sites, hauling earth, spreading earth fill, back
filling trenches, etc.
+TTpr$ Blade
Fig. 6.1 Bull dozer

Construction Practice 1 89
Cable-controlled bulldozers are popular for their simple and easy opera-
tions while the hydraulicany-controlled one could create comparatively a
higher down-pressure on the blade to force the blade on the ground and
maintain the position of the blade in a better way compared to the cable-
A crawler mounted bulldozer could put more tractive effort over the soft
or muddy soil, being tracked it could move over the soft soil easily and at
the same time could also run over rocky soil where rubber tyres may get
damaged. The wheel-mounted bulldozer could run faster and gives a better
output when considerable travelling is required.
Bulldozers and angle dozers are seldom used for excavating by them-
selves. They are able to loosen and remove soil from its original position and
push the soil beyond the limits of excavation. It is found to be useful to start
excavation, to strip valuable top soil from the excavation site, for excavating
one part and filling another part of the site. For deeper excavation, the
bulldozer loosens the soil which is removed by other means.
The theoretical capacity of the blade of a bulldozer varies with the type
of earth and the size of the blade.-The output of the machine could be
determined by estimating the number of passes the machine makes per hour.
Tractor-pulled scrapers are very useful and important for moving earth.
Equipment is available to do each of the three functions: loading, hauling
and discharging materials independently in a better manner and more
economically but the scraper has the advantage of doing all three functions
independently. Scrapers of maximum capacity of about 40 m3 are available.
Scrapers are either pulled by a crawler or a wheeled tractor. The wheeled
tractor pulled scrapers may be sabdivided as follows: single engine, twin-
engine, two-bowl tandem, multi-bowl multi-engine, all wheel electric drive,
and elevating scraper (Figure 6.2 presents the line diagram of a.scraper).The
crawler-tractor scraper having pneumatic tyres could economically handle
loads for short distances. For greater hauling distances this type having a
low speed is not very suitable. A wheel tractor should give a better answer.
The wheel-type scraper may have a two-wheel or four-wheel tractor. Though
Fig. 6.2 Scraper

these have less tractive forces, the higher travelling speed (up to 50 kmph)
make them more economical for greater hauling 1.-- .-... .._
aisrances. 3
Whether a crawler-type or a wheel-type scraper is more suitable is found

from an analysis which depends on factors such as the type of soil, the length
and slope of the haul road, the nature of fill, the weather and the condition
of the borrow pit.
While loading a scraper the front end of the bowl is lowered until the
cutting edge covering the entire width enters the ground at the same time
opening a slot by raising the front apron so that the earth flow into the bowl
is effected. As the scraper moves forward, strips of earth are forced into the
bowl and this is continued till the bowl is full. During handling, the cutting
edge is raised and the apron is lowered to prevent earth moving out of the
bowl. While-dumping, the cutting edge is lowered at the required level, the
apron is raised, and the earth from inside the bowl is forced out b~I means
of the ejector fixed at the rear end of the bowl.
The elevating-type scraper with horizontal slots are operated by two
endless chains. As the machine moves forward, the slots rake the earth
upward into the bowl consuming less energy than the other types. This also
results in more complete filling and permits uniform spreading over the fill.
Standard charts and operating manuals are available for the scraper and
these are followed to avoid any difficulty during operation.
Power Shovels
Power :;hovels a[re used i ite the e;r t h and to dump it into t~rucks or
-*.I:--
other haulu15 -,
T ~ U ~ I I L Cl lL
d---- : . . -
l cL ---.,"-.,
y L . w.~a\iate all tJrye3 "#.F1 a ~ i lWhtlL
c
,, r.
~. >-
L l L F a F
are mounted on crawler tractor they have low speed. When provid with ed
pneumatic tyres, they could maintain a higher speed of travel 01rer firm
ground.
The size of the machine is dependent or1 the size of the dipper wh
run in flush or be heaped up with the 101 ose soil. The essential par
shovel are the cabin, the boom, the dipper stick, the dipper and the hoist line
(Fig. 6.3). To operate the machine it is first of all taken near the surfa~ceto be
excavated. The dipper is lowered to the floor of the pit with its cuttjlng teeth
t
towards the earth to be excavated. The dipper stick is to be operated to lower
I
the dipper and simultaneously the cable is worked upon to pull the dipper
up. By proper adjustment it may be so operated that each time the dipper
runs full. The maximum depth of cut varies with the type of soil and the size
of dipper.
When a number of small works are inv a site, the mobile type of
shovels with pneumatic tyres are preferred whereas in large conct
works the crawler-mounted shovel ispreferred as it is cheaper and (
on soft soils.
t F + b H -+
X Boom angle G Height of cut, max-
B Boom length H Floor le , I radius, max-
C Dipper stick length I Max-d$ng depth
below ground level
D Dumping height, max- J Digging radius, max-
E dumping radius at max-height K Clearance height of
boom point she$
lumping radius, max- N Clearance radiu:
boom point she2
Fig. 6.3 Power shovel
Before choosing a shovel, the cost of its oper ivantages and

disadvantages, the time of completion, the place of c v ~ ~ a r ~ u ~the
i i o condi-
n,
tion at site etc. are thoroughly studied.
*.,-.
The output of a power shovel depends on the type of material to be
handled, the depth of cut, the angle of swing, the size or naul1.g equipment,
the skill of the operator, its physical condition and maintenance, and finally
the job and management conditions. If the depth of cut is small, it is difficult
to fill the dipper in one pass ar.d thereby it runs with reduced efficiency.
Whereas if the depth of cut is more and yields a volume more than the
capacity of the dipper, a 100% operational facility is not obtained since the
mass excavated cannot be disposed in one operation. ~ h &the s best thing is
to operate at maximum capacity. The angle of swing which is the horizontal
angle between the excavating position and the discharging position of the
dipper is made as small as possible to reduce the time required per cycle
which comprises digging, swinging to the dumping position, dumping and
returning to the digging position.
For the efficient running of the shovel one must see that lubrication is
done at regular intervals, replacement of parts and wire rope is done
whenever needed, blunt teeth of dipper are replaced by sharp ones, over-
hauling of the shovel is done during idle periods, the pit floor is kept clean
and hauling units are adequately maintained. To ensure proper running,
there is a need for a very competent supervisor to look after the whole job.
Hoe or Pull Shovel

A hoe or a pull shovel is quite similar to a power shovel in so far as the basic
92 Construction Managemenr ana r
A Dipper U tjocrm
B Brace E Hoi!st cable
C Cable F Gar
Fig. 6.4 Hc
parts are concerned. The main difference he!re is that the position of tht?bucket
*. . . ..
is reverse to that of the power shovel. It digs by pulling the load towards the
power unit rather than by pushing it away as a power shovel does.
The basic parts consist of an auxiliary gantry boom, dipper stick, braces
and dipper as shown in Fig. 6.4. The dipper stick hinged at the bottom point
to provide lever action acts as an arm for the dipper. The dipper is pulled
inwards as the digging cable is taken in, while the boom could be raised and
lowered at the same time. The pull shovel is designed to dig below the level
on which the machine re:3ts and tc the mitt:rial on a spoil ba;nk or in
trucks. Because of its positive acti~ lso capat)le-of digging the hardest
materials.
It is used for digging the earth at or below the operating level and loading
it to hauling units. Functionally it is similar to a power shovel, which could
be changed to a dragline by replacing the boom and the dipper with a crane
and a dragline bucket re5 4mger cremes can be used
1. Draglirle with 1
to deposit earth on emba while it t?xcavate:;earth frc1rn pits or canals
or trenches (Fig. 6.5).
A Bucket Dump calble

B Hoist cable Hoist cha in
C Drag cable Drag chaIn
n Boom hoist cable
6.5 Dragline
A dragline may be mounted on a crawler. or a wheel or a truck depending

on the mounting unit. Walking draglines are also in use. The size of the
bucket indicates the size of the dragline. Buckets of various sizes are in use
depending on the size of crane and the material to be handled. The in-built
resistance towards the overturning moment (witha safety factor) determines
the lifiing capacity of the machine, i.e. the size of the bucket is inversely
proportional to the length of the crane.
To operate the machine, the empty bucket is allowed to move to the
excavation face and simultaneouslythe hoist cable and the drag are loosened.
The bucket is pulled towards the machine and the depth of cut is controlled
by the tension in the hoist cable. As soon as the bucket is full, the drag cable
is slackened and the hoist cable is pulled back and the material from the
bucket is dumped at the desired place by releasing the drag cable. The
dragline does not operate with equal efficiency at any position. The whole
work should be so planned that digging is generally done from the best
digging zone and little work may be done from the poor digging zone if
unavoidable. Charts are available which correlate the size of bucket, the type
of material to be excavated and maximum or optimum depth of cut to be
used. For highest return, one must follow this chart. The output of a dragline
depends on the size and type of bucket, the type of material dealt w.ith, the
length of crane, the angle of swing, the depth of cut, the arrangement for the
removal of material, the size of hauling units if employed, the efficiency or
operator, the condition of machine, and the job and management conditions.
Buckets of types light duty, medium duty and heavy duty are available and
the choice is to be made depending on the type of material to be removed.
Walking draglines are simple to operate compared to the crawler type and
are very popular for the construction of embankments, canals, open, pit
excavation of coal mines, and the removal of materials from the river bed.
Waking draglines having a boom crane 60 m or more are in use.
The crane boom is often used with a hinged bucket, called a 'Clamshell' (Fig.
6.6) for vertical excavation below ground level and for handling bulk
materials such as sand and gravel. The clamshell bucket consists of two
scoops hinged in the centre with holding arms connecting the head block to
the outer ends of the scoops. A closing line is reeved through blocks on the
hinge and the head, so that the bucket closes when it is taken in. The bucket
is opened by releasing the closing and hoisting line holding the bucket with
the holding and lowering line. Clamshells are usually equipped with a
tagline to control the swing of the bucket. Buckets are available in a wide
variety of sizes and types. A heavy duty type is available for digging and
light duty ones for the general purpose of work or handling light materials.
A Bucket (hinged) D Closing line

B Tagline E Holding and lowering line
C Boom F Boom hoist cable
Fig. 6:6 Clamshell
Some buckets have removable teeth which are used in digging hard nmaterials
while others have special cutting lips.
Crane
A crane is a machine designed primarily for lifting but adopted for many
other uses. It consists basically of a power unit mounted on crawler tracks
or wheels, with a boom and control cables for raising and lowering the load
and the boom (Fig. 6.7). A gantry is sometimes added (Fig. 6.8) to provide
better boom support. For greater reach, an extension is added to the boom.
This is in the form of a boom insert, a section added between the upper and
lower ends, or a job, an extension to the end of the boom (Fig. 6.9).
A Boom C Hoist cable

B Load carrier single line D Boom hoist cable for lowt
and hoisting the boom
Fig. 6.7 Crane
High gantry B Taglinc
:ig. 6.8 C:rane with :3 high gant

A Jib D Higher than stanl

boom
B Boom insert E For heavy loads
Fig. 6.9 Crane with a boom insert
The load capacity of a crane depends on:

1. The stability of the footing: The size of the crawlers is a factor because a
longer or wider mounting increases the stability of any footing.
2. The strength of the boom: This is one of the major governing factors in
establishing load ratings, and these should never be exceeded. Ratings
vaqY with the boom length, and any extension of the boom reduces
the rating. Lowering the boom also increases the clearance radius and
thus reduces the rated capacity.
3. The counterweight: This is added to the after-end of the mac:hine.
Manufacturer's specifications provide standard an~d maximum
counterweights and also the crane ratings. Cc3unterwclights mi3y be
increased to,a specified maximum, but the operating radius mu:;t not
exceed that given by the manufacturer.
The working range of a crane is limited ha~rizontall y for the maximum lift
only by the boom length. The reach below the footir~glevel is limited only
by the length of the hoist cable.
Hauling
In earth worK contract, tne rate per cubic metre or -earrn work inc-----
haulage of earth to a distance which is generally adopted as 30 m. However
if haulage distance exceeds 30 m, a separate rate is charged per metre length
of haulage in excess of 30 m. Sometimes a contract is also made including a
haulage without any restriction of hauling distance. Such a contract has to
be quoted intelligently. A site visit may be required before the quotation is
submitted
Compacti
Excavated ear UI 1s placed at LIK s l ~ of
e a fill b y ult: exLavawl5 lilacllulr UI u y
the hauling units. The earth is required to be spread in thin layers and
levelled. For the purpose the common machine used is a bulldozer. Some-
~b (ionsrmcr~onManagemenr ana ~ a n n ~ n g
times another machine named as which does the jol:3 more ejFiciently
is also used. Graders are providea wim a set or .teem 0 1 ..
.* aneaa, or.- me waae * - 1
which loosens the earth before it is handled by the blade. The blade is
adjusted to any angle and depth so that the earth may be moved forward or
to one side. The grader has got an adjustable speed from 3-30 kmph and are
designated by the horse power of the engine, the length of the blade and the
number of driving axles. The moisture content is suitably adjusted by
sprinkling water so that it reaches the optimum moisture content of soil
under compaction. By compacting the eari rolled conditions,
the air voids can be completely eliminatec
The equipment used for the comvactlul~ul caluL 1111 are the smooth-
wheeled roller, the sheep-foot rol.ler and t natic-tyred roiler.
Smooth-wheeled Roller
The smooth-wheeled roller normally has three wheels and with weight
varying from 2-18 tonnes. In some of these rollers adjustment of loads in
wheel could be made by filling the hollo~ w rolls with sand, gravel or water.
It is, therefore, necessary to specify the I oad per unit width and the gross
weight of the roller. These rollers are operated by steam or diesel or petrol
and are used mostlv for road surjFaces.
Sheep-foot Roller
It consists of a heavy drum fitted with projecting spikes blunt at the end.
Sometimes the drum is made hollow and filled with sand during operation
at site. To achieve efficiency either the drum diameter is made quite big or
the spikes are inserted o n the s u.face
~ of the drum in twospirals. Changing
the head of the spikes it can be made to run on diffeirent fill IYtaterials required
.- - - -- . -
to be compacted. Generally the diameter varies from 75-150 crn and length
90-150 cm, and the total weight varies from 2-13 tonnes. These may be
operated with the help of a crawler tractor and a pair of them is made to run
side by side while the third one which runs at the back moves at the middle
of the front pairs. A number of passes may vary fro lependin,g on the
type of soil to be compacted.
-.-'I7 - . -c
To transport such a roller from one place ru anurner, me. rvller . .:
1
.-
splltes 01
the roller may damage the existing track. So, sc me time:s the sp ikes are
arranged on detachable curved plates attached to the drunI. So thaib during
.. .--.-
.
transport
L
the curved plates and the spikes are detachea ana the drum 1s maae
I 1 .
to run easily. This type of roller i:;sometirnes cdec ertible roller.
Pneumatic-tvred Roller
-
A pneumatic-tyr:ed roller consists of a bo,c or a pkitform m~ounted1>etween
two ax1es, the rt?ar one f las one rnore wht?el than 1the front. The whleels are
so arranged that the front and rear wheels move in different tracks. The
rubber-tyred wheels individually sink into any rabbit hole and therefore
compaction is completed without any hole.
These are mostly used for fine-grained soil or sand whereas for cohesive
soil they perform best when water content is 2 to 4% below the plastic limit.
The depth of layer should be around 200 mm so that proper and good
compaction is achieved.
Tools for Rock Excavation

There are various types of drills available for the purpose of rock excavation.
Some of the more common and important ones will be discussed here. The
pattern of drilling, i.e. the plan of drilling is also an interesting feature for
rock drilling. According to the working characteristics, rock drills are
classified as hammer type drills, percussion drills and rotary drills. Hammer
type of drilling is the most important type of drilling. It consists of a hammer,
drill steel and bit. In this method a wedge is driven into the rock by means
of a hand-driven hammer so that a not& is produced. The wedge is then
rotated a part turn and a fresh notch is cut out. The procedure is repeated
until a bore hole is produced. In mechanical type drilling, a piston-type
hammer is acted on by continuous blows in the drill steel. The to-and-fro
motion is effected by compressed air which is allowed on either side of piston
alternatively.
In case of percussion-hand drilling, a heavy drill steel is raised and
dropped successively. As it goes down it breaks small particles of rock. In
case of a mechanical percussion drill, compressed air is used for effecting the
to-and-fro motion. In hammer-type machines, the number of blows may be
1100-2500 per min while in the percussion type it is between 350-600 per
minute.
In case of rotary drilling, the bit is rotated by a machine driven by
compressed air. The drilling speed depends on the shape of the bit. For
cutting soft rock and ores of coal and potash, these are found to be very
suitable.
Hammer Drills
Hammer type drills may be classified as jack hammer, dril11s using com-
pressed air, and drills with screw arrangement.
Jack Hammers
Jack hammers are operated manually with the help of a handle. They work
at all places and are very simple to operate. In drift or tunnel driving this
could proceed during mucking also. The hammer weighs 10-40 kg as
required. The diameter of the cylinder is another important parameter as the
back pressure proportionately increases with the square of the cylinder

diameter.
Jack hammers with automatic rotation are provided with an automatic
rotating device of this bit and the turning motion is derived from the
movement of the piston. The turning motion is transmitted through a bit
holder. The depth of penetration is made limited by a shoulder. For upward
boring the jack hammer is provided with an auxiliary device. For very hard
soil, heavy duty jack hammers known as sinkers are used.
Drills using Compressed Air

These drills are fitted with pneumatic feed with a compressed air feed
cylinder. These do not need any additional device for boring upward or in
inclined position. The rotation of the machine is either by hand or by
automatic means. Automatic ones run easily in ha1d rocks.
Drills with Screw Arrangements

These are heavj7 drills 1with a sc:rew to effect rotation u5;ed for atdvance
heading in very hard roc:ks. Thes~ e are used in con juction M rith an a.uxiliary
..:CL .
device only In drnr . .:.- - 1 1 _ _ _ _
.:-
mixmg mese are used with colurm~s ..-- - ur
- - L--.---;
oars arid on the
surface with tripods or quarry bars.
Rock Drills with Percussive Action

These drills are divided into percussion drills, and column-i'ype cutting and
ripping machines.
Percussion Drills
These are self-rotating machines with rigidly built-in slide for hana-screw
feed to be used in connection with some auxiliary devices only Here the
piston does not strike freely on the stationary drill steel but is firmly
connected with the later. At each stroke, the whole set moves to-and-fro with
the piston.
The number of blows here are smaller but the stroke is longer tl
hammer-action drills. The connection between the piston and drill steel is
easily separable. A powerful rotating device and a retroactive force effects
easy movement without getting entangled in the fissured rocks. Water supply
is to be maintained for removing cuttings and dusts.
Column-type Cutting and Ripping Mach

These are fastened with the help of a p l u e secrur r u cl c u l ~ l ~ rcu~u
u~ u ~ e
machine is adjusted to any desired angl.e. The s8wivellinl 5 motior1 is ac-
complished by turning a crank handle.
Construction Practice l 99
The cutting tool has got 3,5 or 8 edges connected to a detachable carving*
kit and is connected to the piston by a shoe.
otary Dri
For drilling in coal, potash or medium or softer utiifonn ground rotary drills
are used. The rotary piston is eccentrically supported with slots enclosing
thin-walled slides. When the piston rotates the slides whirl outward by the
centrifugal action and seal the chamber. The rotating action is accomplished
by compressed air and is transmitted through transmission gears.
These drills are light weight, highly efficient, and the formation of dust,
vibrations and noise are better controlled.
Auxiliary Tools
Other than the drills, tools like pneumatic chisel, pneumatic spades and
pneumatic picks and rock breakers are commonly used for rock drilling,
cutting and removing the debris. Each one of these have got special and
specific services to offer.
EXPLOSIVES FOR BLASTING
Blasting is done to loosen the rock so that it may be t i or remcwed

from its existing location. It is done by charging explosives and causlng fire
to it in pre-determined holes made for the purpose. There are a number of
explosives used for blasting. Some of them are described in this section.
Dynamite
It is available in many grades and sizes suitable for a particular job. Its
strength is specified by the ratio of the weight of nitroglycerirle to the total
weight of cartridge. The cartridges are 25-200 mm diameter anci 200-600 mm
- . -.--
long. After putting it in the bore hole it is tamped sharply so that it fills" *ha
hole. A charge is fired by a blasting cap or a prima cord fuse. The el€rtric
caps are avail&ie with two leg wires and these wires are joined witl1 the
wires of other holes to form a closed electric circuit for firing purposes.
%s explosive is very mum m use in construcuo~~ sites for the purpose ur

blasting both overground and underground. The cosit is also (zheaper com-
pared to the dynamite. It is detonated by special prirrlers and is much safer
"r I - - -
in use. It is made up of 1 gallon of diesel fuel and abour ft3
.L
~g of ammonium
nitrate fertilizer. The mixtun is allowred to set for 24 hc>ursso tl\at the nitrate
gets thoroughly saturated .with fue1. The rrlixture could easily go ir)side
vertical holes, for horizontal holes it may bc2 run insiide by compressecA air at
0.7 kg/cm2.
Ammonium nitrate is not waterproof. In orde~ * to protect it from the
ingress of water either a long closed plastic tube is in troduced1 inside the hole
and then the explosive is introduced or the explosive is poured in a tu-be and
the tube is inserted in the hole. If the hole is wet for some portio~ ns and
remaining is dry, the wet portion may be filled with dynamite gel and the
dry portion with ammonium nitrate. Arm moniurn nitrate is detonated by
primers consisting of charges of dynamite placed at the bottom of tlle hole
and also at intermediate positions, if requirmed.
Slurry
It is a plastic water resistant explosive thar is maae ~y Drenalng several
materials such as inert gel, ammonium nitrate and aluminium particles with
water to produce the desired consistency. It may be directly poured in the
holes or packaged in plastic bag and placed inside the hole. Being denser it
sinks to the bottom of the holes containing water. Slurries are detonated by
special primers such as dynamite, and Trinitrotoluene (TNT)using blasting
caps or a prima cord. The cost of slurry is something in between a dynami+@
and ammokum nitrate.
OTHER ASPECTS OF BLASTINC-

There are few other things which oi get conve tn with
rock blasting. These are explained
Stemming
After a hole is filled with explosive up to me requmd depth, ule oal ance
- - - is
- -
- -
filled wiith some inert mat1erial which is known as stemming. Stemrnir'g may
even be placed b~ etween clharges at predetermined locations. When cbarges
.. ...
are separated by sremmmg,
- - -
a separate primer may be used for each of- - the
charges.
Firing Cnarge
Several holes are fired at a time in a parallel or a seri
combination thereof. Normally circuits are tested with a galvi
- .
making the final electric comection. Each ( tested to
breaks and misfu
In order to hav re blastin~gwith rc ragrnenti
necessary to place a higher concentration of explosive near the E:lottom.
Stemming might help the process or dynamite of stronger quality is priovided
at the bottom and as one moves up less stronger ones are provided.
Electric Blasting Caps

These are used to detonate charges of dynamite or prima cord fuse. A cap is
exploded by passing an electric current through a wire bridge inside the cap.
The current required is approximately 1.5 amperes.
Prima Cord
It is a highly explosive fuse used to detonate dynamites or special primer for
ammonia nitrate explosive. The core is covered with a sheath for protection,
strength and waterproofing. One or two fuses are placed along the full depth
to avoid misfire. To fire several holes at a time, several fuse from holes are
tied to a common fuse which is fired by the blasting cap. The detonation of
prima cord is initiated by an electric blasting cap attached to the free end of
the fuse.
TUNNELLING
Tunnels are constructed for providing passage ways for railway lines, roads,
access to mines, conduits for water, housing, electric or gasline and similar
other purposes. They may run through rocks, igneous, sedimentary or
metamorphic and therefore physical defects of rocks like joints fissures and
faults etc. are important things to be considered before firtalising the route
of a tunnel. Tunnels constructed under soft soil by cut and cover method are
known as box culverts.
Soil exploration has to be undertaken to know the geology of the place
where the tunnel is to be constructed. This should include the determination
of the type of earth, rock, ground water, etc. If a tunnel is driven through
solid rocks no roof may be required but for other soft soils and disintegrated
rock, the construction of a roof will be necessary. The arrangement of
continuous pumping may be required in the case of presence of a significant
amount of ground water, or pressure grouting may be done to reduce the
flow of water. It may be necessary to change the route if possible to avoid
the presence of ground water. Shock waves propagated through the route
generated by detonated explosives irr holes along the route may be taken up
to study the characteristics of soil. Disturbed, undisturbed and cores of
samples of earth, rock or soil may be collected and tested by drilling and
other suitable method. The spacing of points for collecting samples should
be close to each other in case of irregular character such as the presence of
faults and folds and the spacing may be made wider where more or less
uniform character sf soil is encountered.
After preliminary investigations, the route suitable for the construction of
the tunnel should be selected.
Smaller tunnels may be cut from one direction. For longer tunnels, the
construction might be started Irom either ends and the provision of inter-
mediate shafts (to be converted into ventilation shaft afterwards) may be

made as required.
Tunnel construction involves a sequence of operations which may vary
with the site conditions, the size and shape of tunnel. For tunnelling through
rock the sequential steps involved are setting up .and drilling, loading holes
and shooting the explosives, ventilating and removing the dusts following
explosion, loading and hauling muck, removing ground water, erecting
supports for roof and sides, if necessary, and placing the reinforcements to
undertake concrete lining. .
The common methods of attack for driving tunnels throl~ g rock h are full
face;heading and bench, drift, and pilot tunnel.
In the full face method, the whole cross-section is drilled, Isuitably (lharged
with explosives and fired. This method is suitable for rctlatively smaller
. .
tunnels. It may also be applied for larger tunnels using the jumoo or arul
. ..,
carriage.
In the heading and bench method, the driving of the top portion of the
tunnel goes ahead of the bottom portion. If the rock is firm and the roof is
self-supporting, the process may be one round ahead. For a badly broken
rock, the top heading is driven well ahead ofthe bench and the bench is used
to install timbers to support the roof.
In driving a large tunnel it becomes advantageous to driv 1 tunnel
known as the drift tunnel for a portion or the full length o f t 1. Drifts
may be driven at the centre, at the bottom, at the top or at the sides. The
advantages of driving a drift are:
1. The local problems if any are made known before driving the entire
section and steps could be taken well in advance.
2. It acts like a ventilation shaft when the main tunnel if ;driven.
3. The quantity of explosives required is found to be less.
4. The side drifts may facilitate the ir n of sup roof, if
required.
The disadvantages of a drift are:
riving of main bore is delayed, anc'
le relative cost of the removal of m )mes higl ~yhave
.-Ibe done manually.
Drilling Rock
Drill holes'are to be made in the rock for charglrlg rrle rloles w i u ~explosives.
Drifter consisting of drill bits and detachable bits either steel or carbide-insert
are used for the purpose. Water or compressed air is used to remove the
cuttings fro& the holes. The depth and spacing of holes which depends on
the shape and size of tunnel and the type of I 3e excav,ated is
determined experimentally.
Construction Practice 1 1nn
For smaller tunnels, drills are mounted on bars or columns dependir

whether the width or the depth of the tunnel is smaller than the other. S---. .
jacks are used to secure the bar or column tight against the walls or slabs.
The drift is directly mounted on the bar or the column through an adjustable
clamp.
For larger tunnels, the drills are mounted on jumbos which have a portable
carriage with one or more working platforms with adjustable hemights
equipped with bars and columns to support the drill. The support> " aIc -w,7
designed to permit the drill to follow any set pattern. Nowadays a hydraulic
or air-powered boom is attached to support the drill. The boom is equipped
with controls which facilitates spotting of the drills easily. Several drills may
be operated from each platform. A jumbo ma)7 travel 01n rails or natic
tyres as provided with.
A drill pattern is selected by conducting experiments in oraer KO have
economy and satisfactory breakage of the rock. Over breaking is never to be
encouraged as it will involve more cost.
Of all explosives used for blasting, ammonium nitrate blended with fuel
oil is found to be the best for tunnelling, as it yields better f ragrnent:ition,
requires lesser time for loading and blasting, it is cheaper, simpler and safer
to 1
Tur 3 with Mechanical Moles

A recent development in the field of tunnelling is the introduction of
mechanical moles. Various types of moles are in use. The basic principle
being more or less same. It goes on cutting the soil or earth as per the
cross-section by a rotating disc cutter head. During the operation of the mole
expanding jacks maintain a pressure between the disc and the face c~f the
tunnel while the disc mounting revolves @ 4 to 7 r.p.m. The cuttings are
elevated o:n the top of mole where they fall on a belt cc hat transports
tktem.
En,.
uL ,">ition control of the mole both vertically and horizontally, a laser
-no
bc ;ed nowz
Venrrrarrng Iunnel
A tunnel is to be ventilated for furnishing fresh air to the worker, to re1nove
obnoxious gases and fumes that come from explosives or to remove dlust.
Mechanical ventilation usually is supplied by one or more electric in, ntnr-
L"."L
driven fans which brings in fresh air and takes out dust and foul air from
the tunnel.
-&
.;. /-L*-1 -L
Each worker is to be supplied with 200-500 cubic feet/mitu~c ~ L I11)
I Ul
fresh air. Firing fill!s the turme1 with gas and dust. The cycle of opera tions
may be organised in a manrler so that the workers retire a safe distance from
104 Construction Management and Plannin~,
the face before firing and have break during the time required to
remove gases and dusts which needs about 30 minutes.
The size of the blower depends on the quantity bf fresh air to be supplied.
The cost of energy required to operate the blowers increases directly with
the length of the tunnel and this is to be included to the vroiect co-'
Dust Control
The various operations such as drilling, blasting, loading and hauling muck
cause dust in the tunnel. This creates serious health hazard to the workers
unless properly controlled. To control the dust, water instead of air is used
to remove cuttings from the drilled holes. To remove the dust that come from
the hole during drilling, a vacuum hood is fitted around the drill steel.
Complete ventilation of the tunnel face by the exhaust method following
each round of blasting, keeping the mucEc wet duiring loading and 1using the
detergent with water are the other meastIres to ccjntrol thc:dust.
Mucking
Mucking could be done by hand, or using a powczr shovel
-- .
tractor loader. Hand mucking is done in small tunnels where the ,
--
,,,
mechanical mucker is difficult. For larger tunnels, mechanical mugckers are
used. 'mese muckers discharge the muck into a belt whic!h conve:ys it to a
muck (:ar for final removal. The machines are normallv elecLllLruLv .t.An*ll-, ,
aperated.
the loalding eqlxipment powered with an internal combusition engine is not
used irI tunnels on the 1~ealthgrc~ u n d .
.I* :- L-. :- --
Muc. n 13 11aaled front a L u l l l. -eI l IIL I L ~ ~ U W - g dIIIUCK
u g e cdrb pulled by
locomc~tivesor trucks. Flor muck cars, stec!1rails are require1d and mz~ybe one
lane 01. two lanes depen ding on the size of tunnel and the volume of muck 8
to be ~ ~..L--~-L*-UJV C7.L- ---

IU~. L sdlrle
C
-1. :-- I - -
rail trarn -- --
15 cllsu used for timbering arlu concreting.
_1
The miuck car i!;constructed wit]I! sides hinged at the top and fastened with
latches at the bc~ttomto permit e;3sy duml3ing. The locomotives used may be
I 11
a rrolley, a warrery
1 .. or a comwlnatlon
1 . ,.
or a trolley and a battery. The trolley
type is easy to operate but the bare trolley wire inte~ th other
operations. The battery type is operated by storage batterie rd on the
locomotive. The batteries can work for eight hours and tnen need to be
charged for another eight hours. The combined type is used when haulage
is required inside and outside the tunnel. For running inside, the battery is
operated while at outside the trolley may serve the purpoFa
Ground Suppa
r
.
,
wnen a tunnel is anven, it may pe necessary to support tne grouna aajacent
to the tunnel until a permanent concrete lining is provided. Temporary
supports which is known as timbering should be strong enough to prevent
collapse particulary near the faults, fold and fissures. Timbering depends on
the size and shape of tunnel and also on the type of,soil. In recent times
H-beams fabricated at site are being used as an alternadve to timbers. These
could be installed quickly and may be found to be cheaper at times. To
prevent falling of broken stones into the bore of the tunnel, lagging (a sort
of cover between ribs) is to be done.
Sometimes bolts are used for supporting the entire roof or individual rock
slabs that tend to fall into the bore. The weight of roof is transmitted to the
supporting walls by the arch action. The soil below the arch tends to fall off
and bolting prevents that. The bolts should be long enough to secure the rock
from falling. Tapered expansionable plugs are used at the tail end of the bolt
so that good anchorage is effected.
Controlling Water
In the process of tunnelling operations it is important to see that water is
prevented from entering the tunnel and water that has entered is pumped
out of the tunnel. Water comes from the water used for washing the cuttings
from the drill hole and the other source is the ingress of ground water. It is
possible to know in advance the presence of fissures and faults in front of
the tunnel and these should be plugged by grouting before the tunnel reaches
such a spot.
Air-driven and electric motor-driven centrifugal pumps are used for
pumping water. Air-driven sump pump is suitable near the face of the tunnel
and electric motor-driven pump is used for the main pumping operation.
Cross-section of a Tunnel
The cross-section of the concrete lining should be strong enough to resist the
effect of earth pressure. In solid rock, the desired shape of tunnel may be
provided. For the aqueduct, the section may be circular whereas for a
vehicular tunnel it may have a flat invert, vertical wall and an arched roof.
For tunnelling through a broken rock, a horse shoe shape gives a more stable
section. For tunnelling through an unstable section, a medium circular
cross-section is preferable regardless of the purpose for which used. Elliptical
shape is preferred for water lines, sewer lines etc.
Concrete Lining
The thickness of concrete lining depends on the size and shape of the tunnel
and the pressure to which it is subjected which in turn depends on the
geological features of the surroundings. If steel ribs and reinforcementsare used,
the thickness may be reduced. But this may not strike the desired economy. The
rule is to adopt 25-30 mm thickness per 250-300 mm diameter. Tunnelling
through solid rock does not impose any load on the tunnel and therefore the
106 ConstructionManagement ana rlannmng
lining may be of a minimum thickness. Under such a circumstancee, the ful1

bore may be completed before lining is started so that mucking ana ~ m. m g
1 1.
do not interfere with each other. Under unstable ground conditions, lining
is done after each round of excavation and mucking. The sequence of
installing a lining around the perimeter of the tunnel will depend on a
number of factors. For a circular section the entire section may be placed in
one operation. For a tunnel with rigid base the form work for the roof and
wall may be supported on the base, for large tunnels the pours may be
divided into phases as lining the base first, next the walls and then the roof.
For a tunnel having a base vertical wall and an arch roof, the junctions of
the base and the wall may be cast first, next thewall and roof in one operation
and finally the base.
Reinforcing steel when required in a tunnel lining may consist of a steel
rib, bar or both. In thick linings two layer of steel may be required one near
the inner and the other-near the outer surface of the lining whereas, for
thinner lining one layer of steel near the centre of lining will be adequate.
The forms used are of a movable type. Sieel forms though initially costlier
compared to timber but because of repetitive use are found ultimately
cheaper. The movable type of form is composed of steel skeleton and on the
outer side of the skeleton it is covered with a steel plate or timber which
conforms to the shape of the tunnel. The whole form work may be mounted
on wheels to move over rails and is equipped with adjustable jacks which
create the expansion of the form to the shape required and concreting is done.
After concreting it is reduced in size by operating the same jack and moved
to the new position without any difficulty.
The most common method of constructing a concrete lining is with a
pump crete machine. The machine includes an agitator or a remixer hopper,
a single or double cylinder piston pump and a discharge pipe through which
concrete is pumped in the form. At first the concrete is fed into the remixer
hopper where it is agitated for ensuring uniform quality and it flows to the
pump. The pump is placed just beneath the hopper and during the pull
stroke concrete flows into the pump and during the push stroke the concrete
ejects out into the discharge pipe.
The machine may be set up outside the tunnel near the portal u r Durlre
vertical shaft. As concrete could be pumped only up to 300 ft, the machine
is to be shifted for longer length of construction. In case of a very large bore
the machine may be set up inside the bore over rails so that the machine
could be shifted as concreting PI:ogresses
The concrete walls may be pl,aced by Idirecting the flow rete from
. -
the discharge pipe through temporary openmgs m the t o m . Atter Me wall
..
concrete has progressed as required, the discharge is directed tomrards the
arch pipe or slick pipe already placed on the roof arch. Concreting should
Construction Practice l 107
bc y done in order to have the balancing of load on either side of the

cenrre me. Compress'ed air is injected at intervals so as to push the concrete
to a remote place of the arch and this process is known as air slugging. In
order to vibrate the concrete and remove honeycombs, nozzle or form
vibrators are used.
For long tunnels; having smaller sections where it is difficult to set u P the
pump crete machbxe, a pnewmatic placer is used. This collects the cor~crete
from the cars which carry the concrete from the hopper. Compressed air is
injected in the placer to force the concrete from a discharge pipe into the
form. The velocity of concrete through the discharge pipe is maintained low
in order to avoid seggregation.
EXERCISES
6.1 Discuss how excavation is classifed according to the purpose of work.

6.2 Define and explain the following:
(a) Stripping (b) Roadway excavation
(c) Drainage excavation (d) Channel excavation
(e) Bridge excavation (f) Borrow pits.
6.3 Name the principal earth moving machinery and discuss their specific 1ises.
6.4 Write down the functions of the following machinery with brief discus'sion on
their operating principles:
(a) Tractor (b) Bulldozer (c) Scraper
(d) Power shovel . (e) Hoe or pull shovel (f) Dragline
(g) c:aim shell (h) Crane.
6.5 Namle the equipment used for compacting the earth. Write the specific 1ise of
--..UL-c .I& ten-1.
each ullr
6.6 Classify the rock: drills e~ccordingto their working characteristics. Discuss
(a) Jack hamme]r, (b) Drills using compressed air and
(c) Drills with screw arrangement.
6.7 What is a percussion drill? Explain its working principle. How does a rotary
drill function?
6.8 What are the materials used for blasting. ;Explain tlle process of blasting by
dynamite and ammonium nitrate.
6.9 Write short notes on
(b) Stemming (c) Firing charge
(d) Electric blasting cap (e) Prima cord
6.10 What is tunnelling? How is it done? Describe the sequenc ration
followed for tunnelling.
6.11 Explain (a) Full force, (b) Heading and bench, (c) Drift and 11s.
.,
6.12 Explain ithe proce5 mechanic What do you unde
.
stana3
by ventilating tunnels
.
How shc~ulddust control bce made ef 'fedive in tunnelliqg operaticjn? What is

meant by mucking; and why is it done? How the? ground zidjacent tc) the tunnel
1s supported?
What are the steps; adopted in tunnel1ling opera tions to CI~ntrolwaiter? How
concrete lining pro~videdin 1tunnels.
What is pumpcreti,,,
i..-7..,,,
Un.. . ;..
Am..*
, ,a ;t uu,cc
;L. -,
.,
.,
.;..-I :,,,t.-r.1
a- lining?
Construction Practic -
Superstructure
INTRODUCTION
Concrete is one of the most common building materials which could carry
high compressive stress but is weak in tension. The biggest advantage with
concrete is that it could be given any shape or ,form as required. It '
composed of a matrix of aggregates coarse and fine, cement, and water mb
in a certain proportion as per the required strength in a semi-solid form
is cast within or over a form work, and allowed to set and hardened. The
standard test performed to determine its ultimate compressive strength is
known as the cube crushing strength or cylinder strength as specified and
determined from the crushing strength of standard cubes 150mmx
150 mm x 150 mrn or 150 mm diameter cylinder of length equal to 300 mm
made out of concrete cast in moulds tested after 28 days of casting in a
compressidn testing machine. The coarse aggregates used are broken stone,
e.g. granite or sand stone, crushed in the form of small irregular cubes of
different sizes. Sometimes gravels obtained from river beds or pits are also
used for the purpose. The coarse aggregate is properly graded in order to
have minimum voids in concrete. The fine aggregate used i s normally
coarse-graded sand obtained from river beds or pi1ts. Ceme!nt used is
generally ordinary Portland cement and water is potable, free from acid or
alkali. Water and cement mixed together form a paste. This is mixed with
sand to make a soft mortar which occupies the voids present in the coarse
aggregate. Thus the mixture becomes almost a homogenous matrix of these
ingredients and is known as concrete. Since concrete is weak in tension, steel
in the form of bars are used with concrete primarily for carrying the tension
1 10 Construction Management and Planning
in a structure. The whole composite gives rise to the well-known reinforced

concrete, which is a versatile material used in the construction of most of the
structures nowadays. The tension is transferred to the concrete through a
bond between steel and concrete. Hence the bond is very important and
should be proper so that there is-no slip between the steel bar and concrete.
Concrete being generally impermeable protects the steel from corrosion.
Since the thermal coefficient of concrete and steel is almost same, any change
in the atmospheric temperature does not affect concrete. Cracks are found to
develop in the reinforced concrete near tkIe tensiorI zone. But as these do not
affect the material much, they do not re1quire an!r special protection under
---
normal conditions. For aggressive environmenr ---
protective measures may be
--L
required to save steel from corrosion and concrete from spalling of
CEMENT
The main raw materials used in cement are lime, silica, : and iron
oxide. Since a wide variety of raw materials is used, the oxiae conrent varies.
The calcium oxide reacts with silica, alumina and iron oxide resulting in
tricalcium silicate, dicalcium silicate, tricalcium aluminate, tetracalcium
aluminoferrite, etc. When water is added to cement, tricalcium silicate jellifies
evolving heat. This is responsible for the strength of concrete within first 14
days, whereas dicalcium silicate hydrates slowly and provides a progressive
increase of strength for 14 to 28 days and onwards. Tricalcium aluminate is
responsible for setting and hardening of cement. Other ingredients do not
have much effect on the strength or the setting time. Calcium sulphate is
sometimes added to the clinker for controlling the setting time. Fineness of
grinding improves the early development of strength. Shrinkage and crack-
ing of cement increases due to the increase in the rate of development of
strength.
The different types of ' cement used in ( ion are classified
1. Ordinary Portlandl Cemenf: (O.P.C.)
2. F rdening Portland Cement
3. I t Portland Cemen~t(L.HaP.(
4. hign ~ l u m i n aCement (H.A.C.)
5. Portland Blast Furnace Cement (l?B
' 6. Sulphate Resisting; Portland Cemen
-I-:- PA-
7. Hvdro~hovlc ~ e l l i e n(H.P.C.)
t
8. k ning C ~nent I (A.1E.C.)
9. E ic Cemenlt (P.C.)
OrdL1ary ~ U Al--J
L U ~ cement
~ L U is trle Irrust commonly useu standard cerrlerlr.
It has got all the desirable properties of cement in a balanced form, while
others are used under special circumstlmces or are manufactured using
C o n s f r u ~rractlce
. 11: Superstructure 11 1
different ingredients. All other cements are compared with O.P.C. for high-
lighting their special characteristics. Rapid hardening portland cement h~ - .-L.
high early strength since it hardens rapidly due to high content of tricalcium
silicate. Low heat cement having a high percentage of dicalcium silicate has
slow hardening and generates less heat while hydrating. High alum*-- .un u
cement having,a high Alumina content develops rapid strength evolving a

lot of heat and is more resistant to sulphate attack. Portland blast fumace
cement is more resistant to chemical attack and it hardens slowly genera&
low heat. In sulphate resisting portland cement, tricalcium aluminate is low
and it is more resistant to sulphate attack. Hydrophobic cement is manufac-
tured with an additive which provides a film around the cement particles
and makes it water repellant. The film breal and makes
normal hydration effective.
Air entraint cement is so manufactured thar ir creares air bubbles in
concrete when used and thereby makes it lighter and resistant to freezing.
Pozzolonic cement, where pozzolona is used during manufacture, protects
the concrete better from sulphate attack and develops strength comparativ '
s10\
Standard tests as per IS: 269 are to be clone harrder to ascertain the physiical
properties of differer1t cemen~ t sused in constr,uction. These tests are to be
done for any cement used in construction and the results should be compa:red
with the spec:fied values in IS: 269. For convenience, the results of ordiniary
portland cement which is the most commonly used cement are given belc)W:
1. Chemical Composition
(a) Loss on ignitic)n
(b) Insoluble~esic lues
(c) Lime and alun~ i n acon1:ent
(d) Magnesia
(e) Sulphur content
Loss on ignition occurs due to the evapora noisture and cark,on
- -.
dioxide in cement and these are absorbed from the atmosphere. For ordin?-. lXY
portland cement, this should be maximum 5 per cent.
Insoluble residues come mainly from impurities i m and ithe
presence of other inactive materials. This should not exceeu L 10 in O.P.C.
~ ~
E:xcess of free lime causes unsoundness. Hence the! content of lime

sillic-a, alumina and iron oxidc2 is restricted to 0.66-1.02 Iin O.P.C.
...
Excess or magnesia also causes unsoundness so it should not exceed CO/
in O.P.C.
Sulphur combines with lirr~eand alumina and form:;crystals of calcium 8
112 Consrrucrron managemenr ana r~annmg
I
sulphoaluminate. This causes ai ;ion and ent unso

Hence it is limited to 2.T0'
1 3 10.
2. Fil This refe(rsto the quantity ~tparticle .t weight.

.1-- l--L--
The fi11t.l u l r CCILICIIL 4UIC
.----I.
~ a 3 ~ tis
. 1 the d t . v ~ l u ~ ~ UL
--L
l ~~t .L ~I ~~ cL ~ rlowever,
-l"L
U L .
excessive 'fine cement causes more shrinkage. Finaless is mczasured by a sieve

analysis which recommends that the percentage of : residue !should not exceed
10% for O.P.C. It is also measured by specific surface ---- test which should
--- dred 3
- - - - -.~
~
not be less than 2250 crn2/gm for 0.P.t accordh iine's air
permeability method as per IS: 4031.
3. Normal consistency For determirling the setting time, ter~sileand

compressive strength and soundIness, a cement paste of nc~rmalCOInsistency
is used. Therefore it is necessary ..-I----..
LU luluvv the auantitv of W ~ C T ~
.--L--
Ttf~uire
for
d
normal consistency.
4. Initial and final setting tirll= 1LIr ~1u~t.3 VY3 ~ 1 ~ dC3A

- t tricalcium
aluminate in cement reacts with water and gets soliaified is known as setting.
This is followed by reaction of C3S tricalcium silicate and C2S dicalcium
-*l:--L
t with water when the paste starts harden in^.
b l l l C d L? V
This Drocess needs to be
L
delayed so thalt transpcrtation and placing concr-ete within the form work
could 1De done 1 tting starts. But it should 1 ;early as possible
- - #I.- . .-
8
-.J I . - .
SO ma t no craw aevelops. The setting ana naraenmg r l m e ror u.1-.L.1s
- c-- "O ';
specifil is not le!;s than 3
3 codes ; 2s and n ot more than 600I
minutt tively.
~undnessChange in the 7~olume oif harden1ed concrete is not desirable

I
[usesan undesirable stress in concr,ete. The test performed to measure

v
- -- -.-
ule- soununess
rnis nl cement paste is known as LL 2 2- L L -
rest. This is performeu
_I---- I-.
I ~ Lule
Le Chatelier apparatus and the extension of the standard specimen should

not exceed 10 mm. But if this is done after aeration and spreading, the
extension should not be more than 5 mm. Sometimes this test is also done
by the Autoclave method when the percc :expansion is resl
0.8%.
6. Compressive strength The average compressive s trength o:€ at least

three mortar cube of cement (area of face = 5000 mm2) mzide of on~epart of
cernenit and thn:e parts c rd sand (I known a:;Leighto d annore
sand) 1~yweight is to be red. The quantity of water xed with
tne cement. .IS given by per cent or comwlned weignr
1 .
01 cement ana
sand vvhere P is the percentag.e of wat.er requi~d to .educe a
standard consisitency. The cubes should b~eprepared, store1d and tes
Construction Practice 11: Superstructure 113
IS: 4031. The results of crushing strength after 72+ 1 hot

16 ~ / m m ~ .
7. Heat of hydration For low heat cement, the heat of hydration should
__,
not exceed 65 cal/gm and 75 cal/gm after 7 days and 28 days respectivelv.
Otherwise the temperature differential created between the surface and
interior in a mass concrete work may cause excessive the ma1 strt2sses
resulting in cracks.
AGGREGATES
Aggregates which are inert materials constitute the major part of the conc:rete.
These are divided into coarse and fine aggregates. Any particle size less than
4.75 mm and more than 75 micron is called a fine aggregate and those 1;kreer
than 4.75 rnrn but smaller than 80 mm is called coarse aggregate. The more
densely the aggregate is packed in concrete the better is its strength and
weather resistance. For this reason graded aggregate which give better
packing is preferred. It is also important that the aggregate has good strength,
durability and weather resistance. Its surface should be free from impurities
like loam, silt 5nd organic matter which may weaken the bond with the
cement paste and hence the strength. Aggregates shall not contain har~
material such as pyrites, coal, lignite, shale or any other material that
attack the steel reinforcements or chemically react with alkalies.
As per IS: 2386, the aggregate crushing value or impact value shall not
exceed 45% for concrete other than wearing surfaces and 30% for concrete
on wearing surfaces such as runways, roads and pavements. The abra-4-- .J&VIL
value using the Los Angeles (LA) machine should not exceed 30% for I
wearing surfaces and 50% for other concrete.

Aggregates used nowadays may be classified as:
1. Normal density aggregates having a specific gravit between 2.5 and
Y
3.6 and bulk density between 14.5 and 17.5 KN/m includes most of
aggregates like gravel, crushed rock, and blast furnace slag.
2. High density aggregates are mostly used in nuclear power plants for
shielding radioactive elements and are obtained from barium sulphate
rock, ferrous ores like magnetite, haematite and limonite.
3. Light weight aggregates are porous solids, natural or artificial. The
density, strength, and thermal conductivity in concrete gets lowered
with the use of these aggregates. These may be broken,Jhama bl:icks
or other light weight stones such as Hght sand 5;tone. Nc clay
in the shape of marbles are made in machine and b u ~ high
temperature to produce similar aggregates.
Fibre aggregates like fibres of asbestos and galvanised iron (G.I.) w
cut in small pieces, other cut pieces of artificial and jute fibres are also used
for the manufacture of concrete for specific purposes.
In air entraint concrete the bubbles,generated by foaming the cement paste
occupies spaces in concretelike aggregate and this is called the gaseous
aggregate in some references.
Physical Properties of Aggregates

The important physical properties of aggregates are size, shape, surface
texture, strength (of. coarse aggregate) specific gravity, bulk density, water
absorption and surface moisture, deleterious substances, soundness and
durability.
Based on the size of particles aggregates are classified as coarse or fine
aggregate. Any aggregate having size 80-4.75 mm is called a coarse aggregate
while an aggregate having size below 4.75 mm and above 75 p are termed
fine aggregate or sand. Particles having 0.06 to 0.002 mm are called silt and
smaller than 0.002 mm are known as clay. Silt and clay impair the strength
of concrete and should be removed from aggregates used for concrete.
Single size aggregate is not generally used in concrete rather graded
aggregate is preferred because of its high density and high strength charac-
teristics when compared to single size aggregate.
Aggregate, may be rounded, cubical, angular or flaky. The shape of
particles affects the voids and hence the strength of concrete. Rounded
particles give rise to 30-33s voids while angular particles have maximum
voids ranging from 40-50%. Flaky and elongated particles impair strength
and hence not desirable.
Aggregates having rough surfaces increase the strength however it
reduces the workability while rounded aggregates increase the workability
but reduce the strength. The surface texture may be glassy as in black flint.
It may be smooth, e.g. gravel chirt, slate or marble. It may be granular as in
sandstone or volite. The texture is rough in the case of basalt or limestone.
If the aggregates are granite, gabro or gneiss, the surface texture is crystalline.
The texture is found to be honeycombed or porous when brick, pumice,
foamed slag or expanded clay are used as aggregates.
Generally the strength of aggregate is greater than the strength of concrete.
Under compression, it is the sand cement mortar which crushes and not the
aggregate proper. In case of very high strength concrete the strength of
aggregate may govern the strength of concrete.
The specific gravity and bulk density of aggregates suitable for concrete
are 2.5-3.0 and 14.5-17.5 kN/m3 generally. The values of high density
aggregates are higher and may be 3.5-4.5 and 18-20 kN/m3 respectively.
Aggregates contain permeable holes through which moisture permeates.
When an aggregate sample is dried at 100°C for 24 hours it becomes bone
Construction Practice 11: Superstructure 1 5
dry. When aggregate is dried in air it is known as air dry aggregate. When
all pores are saturated but the surface is dry it is called saturated and surface
dry when it is fully saturated and has got free moisture on the surface it is
called moist aggregate. Saturated and surface dry condition of aggregate is
the ideal condition for measuring the water cement ratio without any
adjustments necessary.
Deleterious substances if present make the concrete weak. Organic im-
purities interfere with the hydration of cement, silt or clay affecting the bond
between mortar and aggregates which act as coating on the surface of the
aggregate. They also provide additional specific surface area of the aggregate
and affects workability. Light weight soft particles may also affect the
compressive strength of concrete.
If there is a change in the volume of the aggregate under heating and
cooling, wetting and drying, or freezing and thawing due to climatic changes,
the concrete is subjected to undesirable stresses. Thus a good quality
aggregate does not undergo changes in volume under normal conditions and
this is defined as soundness of aggregate.
The active silica content of aggregate reacts with the alkali present in
cement and forms a silica gel which swells in volume and disintegrates the
concrete and thus affecting the durability of concrete.
Sand, the fine aggregate used in cancrete, has a peculiar characteristic of
changing volume according to the moisture content. This is known as the
bulking of sand and has to be determined before fresh concrete is prepared.
With the increase in moisture content, the bulking of sand, i.e. an increase in
volume from 15-40% is possible when the moisture content increases 5-8'/0.
Beyond this the film of water surrounding the sand particle merges and
water moves in the voids of the particles resulting in the decrease in the
volume of sand. Obviously, fine sand bulks more than coarse sand. Thus to
get the necessary volume of sand required for concrete it is necessary to know
at what moisture content its volume is the minimum. Bulking of sand is
tested in a measuring cylinder applying measured quantity of water gra-
dually inside the sand and observing the change in volume.
WATER
Water used for making and curing concrete should be free from injurious
substances like oils, acids, alkalies, salts, sugar, organic material and other
elements deleterious to concrete or steel. Water fit for drinking is also suitable
for concreting. Sea water is not recommended for concl'eting as it contains
harmful salts. As per IS: 456, water to be used for concreting should conform
to the following:
1. Acids and alkalies
1 Managervent and
(a) 200 ml sample of wate!r should be neut y not mc

2 ml of 0.1 normal Na(3H or 10I ml of 0. I HC1.
(Ib) Solid content in water should I !d the fol

ages:
,,,-uc
0ro;li 200 mg/l, Inorganic 3uuu mg/l, Sulphates as SO3 500
mg/l, Chlorides as C12000 gm/ e and lo(
for reinforced concrete.
2. There should not be even traces of tannic acid and su[gar.
3. Humic acid or carbonic acid as fou arsh water is har
concrete.'
4. The pH value of water should not exceed 6.
5. In case of doubts, the setting time of cement and cube c rushing sltre~gth
. ..
of concrete should be determined prior to the actual construction using
the available water and comparing the results with similar tests done
with distilled water. The water should be approved if the results of
cube crushing strength using the water is found to be 90% or more
compared to the samples where distilled water has been used. The
initial setting time of the test sample should not be less than 30 minutes
and should not differ by f 30 min compared to the sample prepared
ith distilled water. This is because the setting time is likely to be
kcted by the presence of sugar, carbonates, bicarbonates of sodium
~d potassium, and salts of sodium, zinc, copper and lead. Water
jntaining NaOH may induce quid
AdmixtrJres are Imaterials; used in concrete tfy its pnoperty fc)r some
specific purpose!s. Acco~ :ding to these p these are classified as
follows:
1. Accelerating admixtures or accelerators These ztre used for attabling an
- . I . ... r - - -..:-1.. ..- .
.-..
.
early strength and generally used in cola wearner or ror quic~ repalr.
Calcium chloride, fluorosilicates and trithanolamine ,are most:ly used
for the purpose.
2. Retarding admixhtres or retarders These are used to retard me semng
ne and reduce the evolution of heat. These are! also usjed for
bncreting in hot weather and in ready mix (:oncrete. Comman types
. . .. . .
E! products of starches, cellulose sugar, hydroxyl carboxyllc aclds and
th~eirsalts. Retardel7s reduce the wai ?dfor COI thereby
reducing tlhe water-cement ratio.
-
3. Water reducing admixtures TlLc hn YUIYVJc
-..-r
U J Athese ~ admixtures is to
duce the quantity of water without affecting the workability. Ligno-
llphonic acids and their salts or hydroxylated carboxylic ad~ d and s
ConstmctionPractice 11: Superstructure 1 17
their salts are used for the purpose. These admixtures when used
increase the setting time. To achieve normal setting time or to ac-
celerate the process, accelerators may be used in combination with
these agents.
4. Air entraining admixtures These are used to entrain air in the form of
small disconnected air bubbles which increase the workability and
resistance to freezing and thawing. Air entrainment should be limited
to 4-5% as it decreases the strength of concrete. The agents used for
the purpose are, animal and vegetable oils and fats, natural wood
resins, vinsol resin and alkali salts of sulphated and sulphonated
organic compounds.
CONCRETE
Concrete has got two states: green or plastic concrete and hardened concrete.
During the plastic state, concrete is cast within the form work and com-
pacted. Concrete is made workable so that it is easily mixed, placed,
compacted and finished at the surface. It does not bleed or get seggregated.
Within the form work, the concrete sets, hardens and gains in strength. A
hardened concrete has adequate strength and is durable, impermeable
sound. The properties of concrete are stated below:
Plastic Concrete
Plastic concrete has good workability and is free from segregation and
bleeding.
'Workability It is the easeness with which fresh plastic concrete could be

handled, cast within the form work, made to pass round reinforcements a h
compacted. The proportion of water mixed in concrete is the main factor
which affects the workability. It is sometimes defined as the amount of
internal work required to produce full compaction. Workability can be
improved by reducing surface area of the aggregate. The increase in the
maximum size of aggregate increases the workability. The increase in the
quantity of coarse aggregate at the expense of fine aggregates using round
aggregates instead of crushed angular aggregates are some ways to improve
workability. Fresh concrete loses workability with time as some water is lost
due to evaporation and consumed in the hydration of cement and some due
to absorption by the aggregates. Workability of concrete is tested using a
slump test or a compacting factor test, a Veebee test or a vibro workability
test. In India the first two are generally done and details are available in IS:
1199. Guidelines for the required workability using different aggregates,
concrete having different percentage of steel, different working condition and
type of structure are available and need to be followed for better concreting.
118 ~o'nstructionManagement and Planning
Segregation It is defined as the separation of coarse aggregate from the

mortar thus loosing uniformity and homogenity of concrete. The difference
in size of particles and specific gravity are the prime causes of segregation.
Concrete made out of well-graded particles holds the mortar better and
hence reduces segregation. This may result from the incorrect handling
during transportation and the placing of concrete and overcompaction.
Segregation results in what is known as the honeycombing of concrete when
aggregate particles stick to each other with very little or no mortar thus the
strength reduces a d the absorption of water and other pollutants from the
atmosphere affect concrete and it disintegrates. To prevent segregation of
concrete, aggregate needs to be well graded and the water content, handling
and transportation need to be well controlled.
Bleeding This occurs when concrete contains more water than necessary.
Under the circumstances, the aggregate particles settle down and the excess
water comes up over the surface of the compacted concrete. Bleeding makes
the concrete porous and hence weak and non-durable. Sometimes the excess
water is trapped within the concrete especially near reinforcement and a zone
of poor bond is created.
Bleeding is prevented by controlling the water content, using finely
ground cement and controlling compaction. Sometimes pozzolona or
aiuminium powder is used to reduce bleeding.
Hardened Concrete
The hardened concrete should have the following properties: Strength,
durability and impermeability.
Strength The quality of concrete is usually specified in terms of its crushing

strength at the age of 28 days. The 3-days or 7-days strength is also specified
to indicate the early strength of concrete. Standard cubes or cylinders are
tested to determine the compressive strength in a compression testing
machine. The value of ultimate compressive stress may vary from 10-60
N/mm 2 depending on the quality of concrete generally used for concrete
work.
When data is not available, 28-days strength may be considered as
approximately 1.5 times that of 7-days strength. It is observed that the
compressive strength increases slowly after 28 days and this may continue
even after one year. The increase in strength after one year over the 28 days
strength may be even 25%. IS: 456 has recognised this gain in strength by
specifying 10%,15%and 20% increase of strength at 3 months, 6 months and
one year after casting respectively if the full design load does not come within
the 28 days after casting. The strength of concrete is influenced by the
fineness of cement. The finer the cement the higher is its rate of gain in
strength though this does not affect the ultimate strength.
The strength is governed by the strength of aggregate, strength of mortar
and bond between the aggregate and the mortar. Generally the strength of
aggregate is higher than the strength of mortar or a bond between mortar
and aggregate. The strength of mortar depends on the water-cement ratio
while the said bond depends on size, shape and texture of aggregate.
The strength of a fully compacted concrete versus the water-cement ratio
is found to be inversely proportional and could be related by an empirical
rule as S = -98'4 where S is the strength of concrete in kg/cm2 and W/C is
(W/C>'
the water-cement ratio.
The compressive strength of concrete which depends on a number of
factors is found to depend on temperature, humidity, moisture content and
on the rate of loading on the standard test specimen. IS: 516 specifies the rate
of loading as 140 kg/cm2/min. In order to standardise the moisture content,
the code specifies that the cubes be taken out of water just before testing and
made dry by rubbing their surfaces with a cloth.
Concrete contains a large number of micro cracks particularly at the
interfaces between the coarser aggregate and the mortar. These are due to
segregation, shrinkage and thermal changes. It also develops during loading
because of difference of stiffness of mortar and aggregates. The behaviour of
concrete under uniaxial compression (where the strain is plotted as the
abscisa and stress as the ordinate) shows that the stress-strain relation is more
or less linear up to 0.3 fc', where fc' is the ultimate crushing strength. Since
the existing micro cracks before loading do not change up to this load for
stresses between 0.3-0.5 fc', the bond cracks start to extend and remain stable
as the crack length rapidly attains its final value. Between 0.5-0.7fc', the crack
lengths grow and the formation of further cracks takes place in the mortar.
For stress more than 0.75 fc', the larger cracks reach their critical length. The
system becomes unstable as the complete failure takes place even if the load
is kept constant, the strees-strain curve bends sharply and approaches the
peak point at fc'. After this the curve drops down rapidly until failure occurs
due to crushing. The strain at the maximum stress is approximately 0.002
and this is more or less same with either rich or poor concrete. Only in the
case of low grade concrete, the tip of the curve is comparatively flatte;. The
ultimate strain is adopted as 0.0035 in many countries including India though
at failure it may even reach a value of 0.01 or 0.012. The initial value of the
modulus of elasticity of concrete which depends on the compressive strength
is given as E, = 5 7 0 0 6 ~ / r n r n where
~, fck is the characteristic strength bf
2
concrete in N/mm . The ~oisson'sratio of concrete under uniaxial compres-
sion is found to have a value between 0.15 to 0.22.
Concrete is not supposed to bear tensile stress but since this is related to
crack and subsequent failure, it is important to study the effect of tensile
stress of concrete. Generally the permissible tensile stress has a value between
10-15% of the compressive stress. The higher the crushing strength the higher
is its value but the rate of increase of tensile stress is slow for higher values.
The tensile strength of concrete is measured indirectly by a test known as a
split cylinder test, when a cylinder is placed horizontally in a loading
machine and loaded along a diameter to split. The tensile strength is found
from - 2P where P is the applied load at splitting, while h and d are the
.x: hd'
length and diameter of the cylinder. The split cylinder strength usually gives
a value of 50-75% of the value of the modulus of rupture. In case the tensile
stress is required to be used for some calculation of the strength of concrete
it is a practice to consider the variation of stress and strain as a straight line
variation up to the failure in tension and adopt the Young's modulus of
concrete, E,, for compression as that of tension which comes within this range
of stress in compression.
The flexural strength is expressed in terms of the modulus of rupture of
concrete which is the maximum tensile or compressive stress of concrete at
M
rupture computed as a =- x Y, where a is the stress, M is the bending
I
moment, I is the moment of inertia of the standard specimen and y is the
distance of the furtherest fibre from the neutral axis. The modulus of rupture
is expressed as KC in some references, where K is an empirical constant
and fck is the characteristic strength of concrete.
Tests to determine the shear strength of concrete directly are not con-
clusive because of the effects of bending, friction, lateral restraint, etc. The
arrangement of applying pure shear on the concrete specimen is difficult to
attain. Direct investigation with moment and shear has shown that shear
strength is 20-30% more than the tensile strength and thus the safe value of
shear strength may be adopted as 15% of compressive strength. Depending
on the test to be conducted and the arrangement of lozding, the shear
strength may show quite a high value. Under triaxial compressive loading,
the limiting shear stress can even be made to exceed the compressive strength
under axial loading.
Under flexure, there is a tendency of the reinforcing bars to slip out of the
concrete. This is prevented by the resistance provided by the adhesive force
generated between the hardened concrete and the surface of the reinforcing
bars. This is known as the bond between concrete and steel. The bond is also
affected by the shrinkage of concrete relative to steel, mechartical properties
of steel and its position within the concrete member. The bond is found to
Construction Practice 11: Superstructure 1 21
increase with the quality of concrete and hence the bond strength is related
to the grade of concrete. The increase in bond is almost linear up to M25
concrete (crushing strength of 2 5 ~ / m m and
~ ) thereafter the rate of increase
reduces.
Durability
Durability of concrete is the- resistance to deterioration and environmental
effects to which it is exposed. It includes the resistance to weather, chemical
attack, corrosion of steel and fire. The main requirements of durability are
an upper limit of W/C ratio, a lower limit of cement content, a lower limi.t to
the concrete cover to reinforcement, good compaction, and adequate curing.
In addition the concrete is to be kept free from alkali-aggregate reactions,
volume change due to non-compatibility of thermal and mechanical proper-
ties of aggregate, cement paste and the presence of-sulphates and chlorides.
In case of reinforced concrete, the ingress of moisture or air facilitates the
corrosion of steel, followed by its increase of volume, cracking and spalling
of concrete cover.
Too high a cement content may not always be good from the consideration
of durability since it increases the risk of cracking due to drying shrinkage
if the section is thin or due to thermal stress in case of a thick section. For
3
prestressed concrete, I.S. has limited the value to 530 kg/m . Too low a
cement content makes it difficult to obtain a durable concrete and so it is
desirable to mention a minimum cement content. The cement content agah
influences the following characteristics of concrete.
1. Workability which in turn depends on placing condition, cover, thick-
ness and crowding of reinforcements.
2. Alkalinity of concrete which ensures to provide an e ent
against corrosion of steel. Thus, in a marine environment or under sea
water, the maximum cement specified is more t:han that required in
normal conditions.
3. Water-cement ratio to provide sufficient ccuLcltr paste to fill the vo:-'-
in the compacted concrete.
The recommendations of I.S. serve as a good guide for various cases.
Impermeability
The permeability of cement paste and hence concrete increases exponenti;
with the increase in the water-cement ratio beyond 0.45. High water-cement
ratio will have evaporable water and bubbles of trapped air occupy spaces
called voids. The permeability increases with the amount of voids. Ex-
perience shows that when the absorption of water exceeds 7% the= i
chance of the corrosion of steel. Increased cover thickness, say 15-50 m
may be provided when the concrete is exposed to the harmful action
chemicals, acids, vapour and saline atmosphere. For reinforced concrete

members under sea water, the cover should be 40 mm more than specified
for normal conditions. A low permeability also offers better resistance to
weathering like rain, freezing and thawing. It increases rapidly with the
increase in voids and with the increase in the water-cement ratio. The
ordinary portland cement having C3A less than 5% has got the maximum
resistance against sulphate environment. Portland slag cement and poz-
zolona cement are preferable in marine and sulphuric conditions. An
optimum value of chloride content is required to initiate the corrosion of
reinforcements. So I.S. limits this chloride content to 0.15% by mass of
cement. The code also restricts the sulphate content to 4% by mass of cement
so that reinforcements are not easily affected.
The quality of concrete is also infiuenced by 'creep of concrete' and
'shrinkage of concrete'. These are explained here.
Creep of Concrete
Under stress concrete undergoes a gradual increase in strain with time. Such
deformations under sustained load is known as creep. The final value of
creep strain may be several times higher than the elastic strain. It depends
on the stress in concrete, the age of loading, the duration of loading, the type
and content of aggregate, water-cement ratio, the humidity, etc. On the
removal of load, the elastic strain is recovered immediately (which is less
than the initial value since E, increases with time). There is also some
recovery of creep strain with the removal of load but this is very small.
Shrinkage of Concrete
Shrinkage occurs due to the evaporation of moisture from concrete. It
increases with time at a decreasing rate. It depends on the mix proportion
and the water-cement ratio, and increases with cement content. Shrinkage
causes cracking as the structures are restrained. Cracks also occur due to
difference of shrinkage.
Concrete Mix Design

Concrete mix design is a subject by itself. There are various methods of mix
design in practice depending on the type of ingredients, their properties,
sources of supply, strength required, environmental conditions, percentage
of steel, manufacturing and transportation, laying processes of green con-
crete, etc. These details are not included here.
Equipment and Machines used for Concreting

Each of the-equipment generally used for concrete construction is discussed
in this section.
Construction Practice 11: superstructure 123
I Mixer
1' For uniform mixing of the constituents of concrete, i.e. coarse aggregate, fine
aggregate, cement and water, a mixer is used. It consists of a rotating drum
with stationary blades fixed on the innerface of the drum wall. Mixing is
accomplished by the action of the blades passing through the soft semi-solid
concrete. For mixers up to 1 cu. m capacity the time required for mixing is
1 minute 15 seconds. For higher capacities the time increases by 15 seconds
for every 0.5 cu.m or part thereof. If the mixes are stiff, additional time is
required and the same is true for mixes containing fine sand or small coarse
aggregate. The mixing time begins when all materials are within the mixer
drum.
The mixers may be tilting or non-tilting with either high or low loading
skips. High loading skips are suitable when the skip is being charged from
a bin batcher, but low loading type is preferable if the skip has to be charged
by shovel or wheel barrow.
Mixer is not be loaded beyond their rated capacity and is not to be
operated at speeds other than the design speed. Overloading or running too
fast or too slow does not result in proper mixing. For increased output, a
larger mixer or an additional one is used. Under usual conditions not more
than 10% of the mixing water is placed in the drum before dry materials are
added. Water is then added uniformly with the dry materials, leaving about
10% to be added after the dry materials are in. Mixers are normally operated
by a diesel engine. Figure 7.1 presents the line diagram of a concrete mixer.
A Rotating drum B Operating wheel

C Engine
Fig. 7.1 Concrete mixer
Wheel Barrows
1
I
On small jobs, concrete is transported using a wheel barrow and it is required
to provide smooth runways for their travel. Bouncing may result in the
segregation of concrete and hence the necessity for a smooth runway.
Buggies
Push carts and power buggies are made in a variety of sizes and are equipped
with pneumatic tyres for smoother operation. They must also be provided
with smooth and rigid runways to minimise segregation. In high rise
building construction, pushcarts or power buggies are used to transfer
concrete in a hoist at the ground level and the hoist moves to different floors
of construction. During such transfer it is important to ensure that concrete
does not get segregated.
Chute
Chutes are used to carry concrete directly from the mixers to forms or from
a hopper conveniently situated to allow chuting. Chutes are metal or
metal-lined with rounded bottoms and of sufficient size to guard against.
overflow. 'hey are designed so that concrete travels fast enough to keep the
chute clean but does not create segregation. The slope of chute is generally
recommended as 3 : 1 or 2 : 1 though a steeper chute is used to carry stiff
mixes.
Buckets
Buckets lifted and-moved about by-a crane or a tower are commonly used
where concrete has to be placed at a considerable height above the ground
level, or where the forms are in otherwise inaccessiblelocations. Buckets vary
in size and are circular or rectangular in cross-section. The load is released
by opening a gate which forms the bottom of the bucket. The gate can
regulate the flow so that it discharges the amount required at a certain place
and normally full load is not emptied at the same location. Care is taken to
prevent jarring or shaking of buckets while they are in t r a s i t in order to
prevent segregation.
Belt Conveyor
Belt conveyors used to transfer concrete may be classified as portable series,
and side discharge conveyors. Series conveyor operates at fairly high speed
while portable and side discharge types operate at considerably slower
speed. Concrete is fed into a conveyor belt from a hopper. In order to get an
even distribution of materials along the belt they are well supported so that
they do not vibrate and cause the segregation of the concrete. The slope varies
according to concrete mix and type of belt used. Figure 7.2 shows a line
diagram of the belt conveyor.
Vibrator
. The concrete placed in the hms is to be properly consolidated. It is ensured
that no pocket or space'remains unfilled and that the face of the formed
Construction Practice 11: S U ~ ~ I P I I U G ~ U I ~ ; .
A Hopper E Baffle
B Concrete F Down pipe
C Belt conveyor G Form
D Transfer chute
Fig. 7.2 Series of belt conveyor with hopper
concrete has been made as smooth as required by the specifications. The

compaction or consolidation is done by vibrators. Vibrators are available in
different forms, e.g. nozzle, needle and tray vibrators. For reinforced concrete
work, the nozzle type is the most popular. Vibrators are always inserted
vertically into the concrete and are used for consolidation only and must not
be used for moving concrete from one place to another within a form.
Vibrators are also used sometimes against the outside of forms and are most
effective in producing smooth surfaces against the form faces. The process
of vibration brings enough mortar to the surface or form face and ensures
proper finish. But it must be remembered that excessive vibration causes
segregation because the coarse aggregate is forced away from the vibrator
and pockets of mortar form around it. Vibrator may be run by diesel or
electric power.
Tremie
One of the most widely used methods of placing concrete under water is by
the use of a tremie. This is a pipe whose diameter is normally eight-times
the maximum size of coarse aggregate being used in the concrete. It is
commonly made 250-300 mm diameter and about 3 m long. A funnel-shaped
hopper is bolted to the top and sections are bolted together with a gasket at
each joint to make a pipe long enough to reach to the bottom of the
underwater structure from the surface.
The bottom end is fitted with a water-tight valve and the tremie is lowered
, by hoisting equipment into position. Placement is begun by filling the tremie
with concrete, while a bottom valve is closed and then opened to allow the
concrete to flow out. It flows outward from the bottom of the pipe, pushing
the existing concrete surface outward and upward. Concrete is fed to the
tremie continuously as long as the valve is open and as long as the flow is
smooth so that the concrete surface next to the water is not physically
disturbed. The tremie is slowly raised as concreting progresses but the end
is kept submerged in concrete at all times. Where large areas are involved
several tremies are used together, the concrete from each flowing into a
common mass. In most cases, the tremies are spaced at 6-8 m apart.
The mix proportion of tremie concrete is somewhat different from the
normal structural mixes because the concrete must flow into a place and
consolidate without any mechanical help. The slump is 150-225 mm and
A Tremie pipe D Concrete

B Water E Gravel
C Cable
Fig. 7.3 Trernie
generally rounded coarse aggregate is preferable to crushed stone since the

flow is better with this aggregate. Figure 7.3 shows the working principle of
a tremie.
REINFORCING STEEL
Inconcrete structures, steel is used either as reinforcement or for prestressing

structures. Reinforcing steel primarily used for carrying tension is placed in
the form work and then concreting is done and this is subjected to stresses
under load. Whereas in the case of prestressed concrete the steel is stressed
before the member is loaded and the tension in steel keeps the concrete under
compression so as to neutralise the tension that may come due to application
of loads.
The most commonly used steel reinforcement is available in the form of
round bars of various diameters starting from 6-50 mm diameter. These bars
have plain or deformed surfaces. Welded wire fabric is often used for
reinforcing slabs, walls, shells, etc. These consist of cold-drawn steel wires
running in two directions at certain spacing and welded at the junctions by
passing a high electric current.
The commonly used steel reinforcements are mild steel (Fe 250, Fe 230 and
Fe 210), medium tensile steel (Fe 353, Fe 348, Fe 323), high yield strength
deformed bars (Fe 415, Fe 500) having lugs, ribs or indentations. Recently
the Steel Authority of India (SAIL) has introduced a high strength micro alloy
structural steel available in the name SAILMA having a range of qualities Fe
300, Fe 350, Fe 410 and Fe 450. Tor-steel Research and Foundation have also
introduced a new product known as TOR-KARI steel of quality Fe 550 where
wires 3-9 mm diameter in steps of 1 mm diameter are produced. This has
brought about an economical use of steel.
The mild steel has a definite yield point and the plastic strain may extend
up to a strain of 0.15. Cold work high strength deformed bars, SAILMA or
TOR-KARI steel do not have a sharp yield point and the characteristic
strength is expressed as 0.2% proof stress. High tensile steel available in the
form of wires, strands and cables also do not have a sharp yield stress and
its characteristic strength is expressed as 0.2% proof stress.
The reinfarcing bars need to be free from cracks, surface flaws, laminations
and other defects. They should. comply with the requirements of dimension
and weight.
Tensile bars should be tested for tensile test, and cold bend test. Tensile
test is performed to obtain the stress-strain curve, yield stress or 0.2% proof
stress, ultimate stress, percentage elongation, etc. The length of a test
specimen between the grips of the machine has to be more than 9 times the
diameter up to 25 mm diameter and 4.5 times the diameter for higher
I
diameter bars. During testing, the load applied should be .axial. The gauge
length is adopted as 8 times diameter for bars up to 25 mm diameter and 4
times for higher diameter bars. The stress-strain curve is automatically
recorded in the recording and the plotting device attached to the machine.
Sometimes extensions are recorded by an extensometer and the load
recorded in the dial. The rate of loading is maintained 30 kg/sq. cm/s.
The cold bend test is conducted to note whether the bars are bent without
causing fracture. The specimen is bent by pressure or with-a steady blow
from a hammer until the two sides of the specimen are parallel. The internal
radius of the bent'is less than equal to diameter of the bar for bars up to 25
mm diameter and 1.5 times diameter of the bar for bar greater than 25 mm
diameter. The bars must not fracture under the test.
FORM WORK
Introduction
Concrete in plastic stage has no form and therefore it needs to be moulded
in the required shape. Form work includes the mould in contact with
concrete, the supports and bracings and the necessary hardwares. The form
work techniques have also developed along with the growth of concrete
construction. Previously only timber was used for form work but dowadays,
plywood, metals, fibre glass, plastics with special type of accessories and
hardwares are in use. Prefabricated form work with repetitive use is becom-
ing popular to save time and maintain quality.
Previously the erection of form work was normally done by carpenters
using timber and nails in a most conventional way with a high degree of
safety. Nowadays with the advent of plywood, steel and plastics, the design
of form work has become quite an involved task on the part of the
construction engineer. The failure of form work and the consequent loss of
money labour and sometimes even life is not very uncommon. Failure may
be due to a fault in the design, material, construction, a combination of these
or may even by loss of strength due to too many repetitive uses. In USA and
U.K., committees were established to study the causes of failure of form
work. In addition to many technical causes of failure, they have also
highlighted the failure due to the occurrence of horizontal loads on the false
work or form work which the designers normally ignore. Out of all
recommendations made by these committees, the following are important
and are to be noted. The form work is designed thoroughly on similar lines
as structural design and sketches and calculations are available to the
contractors. Horizontal load equal to the sum of all horizontal load plus 1%
of vertical loading or 3% vertical loading are considered as the horizontal
loading on the form work. There are short courses on form work or false
I Construction Practice 11: Superstructure 129
work provided to architects, consultants and supervisory staff members.

Handbooks are to be prepared for estimation and providing guidance for the
form work.
A form work designer is supposed to achieve the basic objects of quality,
which means to build a form accurately so that shape, size and finish of the
concrete is attained; safety, to ensure that the form is capable of supporting
dead load, live load and other lateral load on the casting, and economy in
time, money and labour. To achieve the above correct assessment of loads,
the pressure of green concrete, selection of forming material considering its
strength durability and cost and selection of supporting system must be
given due attention. Provision for proper and safe working and access for
labour and equipment must be made as also proper schedules with regard
to the stripping, removing shuttering and form work after completion.
Loads on Forms
Loads to be considered on form work are based on the density and slump
of concrete, rate of pour, method and height of discharge, concrete tempera-
ture, vibration, reinforcement details, stiffness of forms, etc. A load of 300
2
kg/m2 on sheeting, 200 kg/m2 on joists, 1800-2500 kg/m in walls and
columns may be assumed for the form surface, an additional load of 1000
kg/m2 may be adopted to account for the falling of concrete over a height
of 2 m or more. All factors given due consideration, the maximum pressure
for design of forms need to exceed 15000 kg/m2.
The transfer of load from floor to floor during consi s an important
consideration to be given. Propped-up floors receive soaas from the fresh
concrete laid on floors above in a multi-storeyed structure where the
flexibility of the props and the rigidity of floors are important aspects to be
considered. Under such conditions, 2.4-3.0 times the load due to the self
weight is considered to be adequate for the safety of the floors.
Codes and Specifications
For ensuring safety, quality and economy in building forms, standard codes
and specifications are available in different countries.
In the USA, the recommendations of the ACI Committee, 'Form work for
concrete updated now as Recommended Practice for Concrete Form work'
(ACI 347/78) is followed.
In the UK, the Standard Codes BS: 4074, BS: 5973, BS: 5974, BS: 5975 and
BS: 6100 are followed for &e form work. The codes specify that form work
should be of appropriate quality to produce satisfactory dimensions and
surface appearance, it should be safe and the risk of damage to people and
property shall be a minimum and its cost should be as low as possible. For
I the design of form work, two principal loading cases name!ly,the hc

I
load and the vertical load are accounted for. The design shclulu - ...
1A LV1131Uc2 ULc
plan and dimensions, the type of cement and adrnixtures, the fomt height,
am....
the rate of rise and the concrete temperature.

The basic planning of form work takes ULLU ~LLUUILL LL?.
:-LA L-ll--.- :-. L J U L I L L 5 .
-..-I.
ULC IUIIVWU~F
, I
I
I strength and stiffness, repetition, durability, stripability and cost.
In India, the Indian Roads Congress has prepared 'Guidelines or1 Design
and Erection of Form work for Road Bridges'. Indian Standard Institunon . .. .1s
presently engaged in the'formulation of 'Code of Practice for Form Work'.
In Australia, 'SAA Formwork Code' Australian Standard 1509 has
specified rules for design, fabrication, erection and stripping of form work
and false work for any concrete structure. This code has identified and clearly
stated the common deficiencies of form work leading to its failure. These are:
1. Inadequate lateral and diagonal bracing of shores, lack of bracing at
joints in shores, poor splicing of timber shores, out of plumb shoring.
2. Locking devices on metal shoring not locked, in-operative or missing,
%adequately tightened form ties 01 wedges, insufficient naili
a
h e Use of prop on prop, failure tc3 recheck tightne!3s of resl

loors below.
'he following points also need to be addressed to prevent failure:
[a) to inspect form work during and after concreting tc1 detect
abnormal deflection if any and adopt corrective measure'S;
b) to provide adequately agains pressur~ es on fc~rmS,to
control the vertical rate of pla 3f concre!te and f herefore
------
lat~ralpressure on forms with regara to slump, type ,. .., ..
- - ot vlbratlon,
effect of admixtures, low concrete temmperatures and also to
re@ ate properly the horizontal rate and seqllence of placing
-,-.--.ete to avoid unbalanced loading on t o m v,rnrC
rnnr?
5. Premature removal of supports, vibrations ar~dshock;arising 1

movement and the lack of field inspection 1:o ascert: lin that t
work conforms to the design.
iI Materials Used for Form Work

Locally available forming materials are generally chose]n for th~ e work.
I Timber, plywood, hard board plastic, fibre board, corrugalted boxc?s, steel,
aluminium and plaster of Paris are commonly used for shutte~ :ing. To
I
improve the surface texture, thin metal sheets, PVC sht=ts, pol]ysterene
I
sheets, neoprene kraft paper and hard board fibre board are used :LS liners
attached to the inside face of forms. I
Timber Timbe:r is the mlost cornnon mattrrial for shutterin~ ;and is available
almost cevery wFLere. It is compara~tivelychleaper an d could 13e easily shaped.
Construction Practrce rrr aupersrrucrufe 1 31
Good quality timber and skilled carpenters are difficult to get. Timber
deteriorates under the stress of heat and contact with water. It is difficult to
evaluate the proper strength of timber. Thus, a scientific approach of design
with timber becomes difficult and a conventional approach is adopted.
Because of the inherent defects, timber shuttering may not be repeatedly used
for many times. In India, for supporting the form work of floor slabs, timber
props or ballies of diameter 60-150 mm are used at close intervals. These are
cut to have proper length and are adjusted with wedges underneath. Timber
runners are used in both directions being supported on the props. Timber
plank or plywood shuttering or steel forms are placed to support the slab.
Wedges are to be placed very carefully so that these do not come out due to
vibrations. The ballies are not always straight and should be inter-connected
with adequate bracing so that an eccentric loading does not cause buckling
and subsequent failure.
Plywood Plywood has got a better surface and g

These are useful and economical for larger panels wlth repetitive uses. lhe
-
noother finish.
top coating of plywood resist abrasion and reduces absorption of moisture.

Sometimes these need timber frame backing. Plywood bonded with phenol
formaldehyde has better resistance against layered separation due to the
effect of heat and moisture. It is also available with resin impregnated fibre
face permanently fused under heat and pressure. Such plywoods are known
as plastic coated plywood which may even be used sc2veral tin~ eifsused with
care. Plywood is also available with texturised surfat:es or de:signs which are
used for exposed concrete surfaces. Timber shutters and fornns are found to
deteriorate at the cut edges due to heat or effect of moistureI. Thus urhen it
is not in use, these need careful storage so ias to ens1ure m a qI more nlumber
of uses.
Hard ba [ard boards are manufactured fr'om woc~d fibre under

controllel lation of pressure, heat and moishire. These are tempered
with the impregnation of drying oils which are stabilised by heating.
Tempered hard boards have improved strength, low water absorption, better
abrasion resistance and are used as formwork lining. Thinner hard board
could give curved surfaces easily.
Fibre forms Fibre forms are used as lost fa~rms for c , ,fs and
~ a l l sroc
slabs. These are left in place on the exposed face of the concrete where it
gives architectural look and also improves acoustical and insulating proper-
ties. These are made from glass or wood fibres. The manufacturers publish
re bndationsi which a[reto be strictly followed.
Gypsum board Gypsum moulds are generally tised to I artistic

I JL bonsrrucrlon Managernenr and Plannin!
design or ornamental pattern for the ex1 ncrete fa1 einforceaI

with an oreanic fibre or coir to make ir tvug1tt.r. PLvIlcrere
--.
qualiry
I:,-- -----
may
U
improve due ct D the ab:jorption of extra water present in concrete by thesc

board:;. These 2Ire fragile and needs careful handling.
Asbestos tiles' If acorrugated iface is rec ies like ccmugated

sheets are usedI. Sometimes these tiles ge :rete due to bond.
c forms PVC, nf?oprene,and pol4rester strc~ngthene !d with glass fibre

me
a ~ ~r U
J of thcI plastic Forms in use. The:y are m anufactura.d as per requiredI
shapes, do not rust and are easy to clean. They do not deform and assembly
and dismantling are rather easy. Polypropylene moulds are nowadays very
popular for waffle slabs. These moulds have got another advantage because
they a re weldable.
Lost f'orms Forms, which are not removed after casting, form a part and
parcel of the st that beh;we as composite:;. These i3re knowm as losit
forms. Precast c 3lanks, p ressed fit)re planks, card bc)ard tubes, precaslt
. - -... - -
re~ntorcedconcrete lolsts, clay filler blocks and ferrocement planks are
des. In India, the Ejtructura1 Enginec ntre has I I
3f these f o m s ancd these are in use
Wire rnesh FE Ires are c:onstructc?d with a s h as the

lost forms. Son Ire applit?d over the wire o form a
...- -CI..-
stnlrture 01 Knvwn sna]r --
Inflateld memtwane These memwranes are som etimes u[sed to serve as a

* .- . - . . .
$nrm "vork. After inflatmg the membrane to the required shape, it is coated
lVLlll
7,
with a layer of plaster which is reinforced with a steel Imesh for rigidity.
Plaster may be spread by short creating. These forms re!duce thc time of
construction and the stripping, &--
L
LU~LC
L - ai
A:.- .
-s could easily be ulallcantled -bv
on. Such membranes are 2~lsoused for cavilties in ini places.
.-
31ee11form work Steel rorms consisnng or angles, tubes, joists, nat plates
1 I . 7 .
are ve:ry much in use as shores, bracings, runners, slab shutters, etc. Steel
form are also in use in combination with timber. These are very strong, could
we used repetitively without much damage done to these forms. Because of
the known characteristics of steel, design calculations are easily done in a
systemlatic manner. The line, level, dirnen!;ion and surface finish are all nicely
.. . . ..
attamebd with steel forms. The entire system is so designed that it can be
asseml>ledvery. quickly and in proper sequence. For smalle!r panels these are
manue~llyoperiated whj11efor larger panels mechanical h andling could be
done. Accessories suitable for different dimensions of the member s are
.b A:-,.-*
available and the forms are adjustable in order to have differenL ~ ~ ~ ~ ~ ~ s
The form work supports are either single-leg type or multi-leg type. The
single-leg type is known as the prop or shore and is made as a telescopic-type.
These are generally made for height up to 5 m. Beyond this height the.,-;e--- aw
used in tiers tied and braced to form a rigid structure. For a multi-legged
system, frames and trestles are used which could be assembled one above
the other to get the required heights. For finer adjustment the small L C ~ D ~ A T
jacks either at the top or bottom are generally used.
Horizontal supports are constructed as light weigh beams of box
--
_..
or triangular section which are also telescopic and can cover a range C
o r s_ pans.
They rest on either beam forms or shores/trf ?sties. Nc) intermebdiate sul2port .
may be necessary for these arrangements anc1 wide free space!j are avaiilable
below the form work.
Other features like plumbing frames whiclI keep th e form work in PIroper
shape using tilt-up struts or rakers. Walk-wa!r brackets may also be atta~ched
to the main form work. Dropheads which when used on the top of the slhores
would support a wide area and the form work at other places coulId be
removed within a short time after concreting and reused. This has mad.e the
steel form work so versatile.
Nowadays, more sophisticated steel form work known as I;ang fonn are
3
used for wall concreting and table form are used for casting slam lnes;e are
handled by cranes since these are used in large sections. Tc te an
accurate alignment of the gang forms, plumbing frames and sy )esof
concrete hardwares are used. The table forms rest on adjustable legs, the deck
may be steel or plywood and serves as soffit shutters for the slab. The vfhole
table along with the shores are built in one unit and can be lowered or r,aised
by means of specially designed jacks. After concreting, the table is lo^rered
and taken out of the building by rolling the table out on castors and then
slinging with a crane.
Slip forms In slip form or sliding form construction, which is an extn~ s i o n

process, the rate of movement of forms is regulated so that when the f o m s
leave the concrete it is strong enough to retain its shape while supporth.,.rni t c
own weight. This is applied where continuous concreting and monolithic
structure is designed. Silos, bins, shafts, cores, caissons, bridge-piers are some
of the vertical structures where slip forms are used while canal lining, k-nal I I U L L I
inverts, high way pavements and water conduits are the horizontal structures
where slip form are used.
Vertical slip form system comprises assembly panels made of timbrr UL
steel and is supported by a Yoke assembly placed at 1.5-2.0 m interval. The
form work is moved by mechanical or hydraulic jacks which climb either on
a pipe or a solid rod embedded in the concrete. The entire load of shuttering
including the platform deck is transferred to the jack rod or pipe through the
jack. The gripping devices in the jack are either tooth or ball type. The speed
of sliding depends on the setting time of concrete, the ambient temperature
of concrete and the type of cement. With normal portland cement under
tropical climate a sliding speed up to 6 m per day is possible.
Changes in the cross-section, the provision for dowels for extensioin, Block
out for doors and windows inserts and pockets to run Lotrcu~ls -,
,
-
a-r--
t: I ~ U W
possible on the vertical slip forms. Tapered structures like chimneys and
, cooling towers are now constructed with additional mechanical or hydraulic
jacks which adjust the forms circumferentially to the required dimensions
simultaneously with the moving of forms vertically.
Horizontal slip forms generally move on a rail system or a shaped beam.
I The slip forms both vertical and horizontal carry with them the working
..
deck, the concrete supply hoppers and 2
required for concreting.
During sliding the drifting from plumb and twisting alF Uy
y l F V F l l C F U
adequate bracing of the frame work and checking the verticality by plumb
bob and the platform should be always kept at the same height as the water
level system.
In order to have a fre~ e movenlent of the Jack rod, a sle~ eve of 1.0-1.5 m
long is inserted around 1:he rod \vithin the concreite and is attacheci to the
.L -,.-A:-
yoke. S l i ~
forming is a jov round
L U I I L U ~ U ~ ~ the clocn --J
arlu is a special !-I
rype I--..
of cons truction and the refore nc ;e supervision ar~d coordlination

betweerI the diff erent agcencies. It s main a e is the 5 onomy,
--J -.--- 3.-__- _,. . .,
quality atu wurkmanship ru prvauce a monolirnic srmcrure. lvovvaaays,
L_ 1- '
major cc s of the country are well equipped with slip form arrange-
ments.
Suspended, moving and other forms These are also in use for special type
of work and serve as an alternative to slip forms. Suspended forms are used
--
for chimneys and silos, whereas moving forms are used for the construcnvr~
- - -
-. -L:
of tunnel lining, sewer lines, galleries, cullrerts, sea walls, folded plates and
shells where repetitions of similar structur e contintie for long stretchLes.
Moulds for Prec:ast Con
When a large nu rnber of !similar structural element$; are reqtiired, pre
-7- - .. rar-orr
is done. It may be aone on or near the job site or in factor~esqulte c
? .
ana
.
are transported to the site of construction. Precasting ensures accuracy,

controlled quality and uniformity in floor elements, columns, lintels, door
window frames, railway sleepers, louvers of cooling tower and others. Any
small element that could be easily handled and neeii s mass scale production
could be done with precast concrete. A COInplete b~ridge is constructed with
precast elements handled by mechanical means. The moulds are robust to

withstand large repetitive use. These are easy to assemble and detach thereby
reducing productiorI time. A rrangements for good vibration and accelerated
curing are provided within f he mould. The choice of mould depends on the
- r ...
total number and rare or production, the shape of element and facilities
available in the con!;truction yard for casting, curing, storing and handling.
Precasting is done either by horizontal or vertical moulding. Horizontal
,- ...
casting is undertaken tor rimed or curved elements, multi-layered elements,
etc. whereas vertical castings are done for single layer slab panels. Shutter
vibrators are often mounted on the underside of the mould for horizontal
casting and on the sides for vertical casting.
Of all types of moulds available, masonry moulds, wooden moulds, steel
moulds and plastic moulds are most c6mmonly used. Sometimes small
structural components are cast on a vibratorv table which ensures e---l uuu
compaction of conc~
Prestressed prete~nsioned elements are prot
I unit stec21 moulds or
7 , 1 .
sometimes in long line or production Day m oraer to nave mass proauctlon.
Scaffolds are used for providing temporary platforms at various levels. These
elements are also used for centering or supporting heavy loads at great
heights. Timber scaffolds are mostly used and are available throughout the
COT erea as rn :fold are now be~ingintrc
COI ns.
Timber ScaffoldingI
In timber scaffold, aIne may Ihave bally or ban Lese are c
. .-. .~-l~:-c
almost in all places. srarung from small bu~lalngunlrs rv mu~nsroreyed -..-
building complexes as also in the construction of dam, barrage!5 and sin-iilar

structures. For high structures, the bally and bamboo scaffolding; are so mlade
.
that it looks dreadful and the user does not feel much comfortau~ewhen
1 1
- ---.
using these scaffolds. By and large, the bally or bamboo scaffolds are
constructed by tying them with coconut coir ropes. Due to continued
exposure, these ropes as also the bamboos get deteriorated and the joint!2 A- n,
not remain firm. It is also very difficult to keep these scaffolds on plumb.
Therefore, the factors of economy, availability and ease of usage make timber
scaffolds the preferred ones. It is required to make laws to ensure that these
scaffolds are not used for tall structures.
Timber scaffolds are of two types:
1. Single pole Here one row of poles are fixed closed to the uuuulrlg ur
wall and connected horizontally by ledgers along with cross member
or put logs connecting the building or wall.
i30 c;onsrmcaonManagement ana rrannlng
2. Double pole Here hNO rows of poles are fixed one nea~ rtothebuilding
.1 . ,. ..
or wall line and the otner row aDout one metre rurtner apart.
These two rotYS of vertical poles are coinnected 17y put lo'gs and h
tally by ledgers#.This i!s also known a:; indepe.ndent sc:affold. S
diagonal bracing* -- art:
--- also
-1-
provided. Somenmes -. -..:---
-L--
wrlen - -- memDers
mese 1.LL
are
sawn they are nailed together instead of tying with ropes i?it junctic)ns and
joints. IS: 3696, which provides the safety and det;d s of tinnber scaf folding
and ladders, must he followed.
Metal scaffolds
Metal scaffolds are generally made of steel. Other nnetals arc rarely u~sedfor
the purpose. In order to provide a more durable, depend[able, stc~ u tand ,
. -
s t r ~ i scaffolding,
~g metal scaffoldings of various types are being incren@in--1.i7 rwurljry
used. In metal scaffoldings, the heavy duty ones are used for brick rrlasonry
or concrete construction, medium duty are for carpentry and plaste!r work
while light duty ones are used by the electricians, painters and ~lccutcr>. Am--..-
Depending on the arrangement, one may have single row put log scaffold
or independent double pole scaffold as in the case c,f timber scaffolds. Metal
scaffolds are also used as cantilever scaffolu A-.,.I-. :
w l t a t lt is reauired to vrotrude
I
them from the face of the buildings or structures.

Metal platforms may be erected at any desired 1( letal scaf folding
in order to ease the construction work or place heavy objects at any level.
- -
&ch scaffolds are known as platfo~rn scaffcAds. Tower scaffold'is, constructed
of metal scaffolds having upright!5 connedted by ledgers and trans01ms, are
often made mobile by fixing castors at the base. For special tvpe (3f- jobs, < L
' -
suspended scaffolds known as cri~dlesare hung frlom buildlings ancL struc-
tures without touching the grouncI.
Metal scaffolds may be either tube and fitting type or prefabricated unit
frame type. Tube and fitting type is the most common one while the frame
type is made for specific jobs. The tube and fitting type consists of plain
tubes, which are used for making uprights, ledgers 1s and p~. ~logs,
t
various types of clamps, couplers, joint pins, etc. and are u sed for c'onnec-
tions. There are various codes of practice which speclry ..- me ,.
., aetails of
construc he scaffc,Id and f'or the si these scaffolds. SDme of
these spc ns are given belaw:
a L.
. La-. I---:- -a .----.2. --ll-- :- rder to
1. Th
ha id and si should E
bc
2. To prevent overturning - and collapse under htgh wlnd loads annrr21 -r---*
ecaution,ary meaziure of arwhorage is to be taken f o:~the scaf folds.
~ i d erails and toe boards !should allways be provided for the! safety
Construction Practict r r . oupcratr uuur c
of the workmen as also safety nets and screens should b

catch any falling materials.
4. There should not be any uninsulated wires near the metal scaffolId.
5. Scaffold on thoroughfares should have warning lights. Grease, Inud,
paint, etc. should be removed at once if these items fall on the scaffnld
and sand or saw dust should be spread to prevent slipp
6. While dismantling it should exactly follow the reverst
used for assembly.
For prefabricated unit-frame type scaffolds, many good designs patente
manufacturers are available.
These are made using adjustable components with mrumum loose 1parts
and are easily erected at site by unskilled labour. Each componeint is
thoroughly examined in order to determine the individual load car1ying
capacity of each component correctly.
-
BRICK MASONRY
Brick, except sand lime or sand cement brick, are burned from
fire clay or mixtures thereof. The fire clay bricks attain a colour Durr or
shale bricks become red generally when burnt and sometimes it takes brown
or black colours also. When bricks are underburned they look pale orange
and are too soft. Sometimes well-burnt bricks may also take the pale orange
colour which is due to the ingredients present in clay. Underburned bricks
make a dull sound when one is struck with another and may also disintegrate
when subjected to wetting or freezing. The strength of brick is expressed in
kg/cm2 or ~ / r n r nwhen~ tested in a compression testing machine. There
may be bricks of various strengths available and accordingly these are
classified as Class I or Class 11. For load bearing masonry structures, Class I
bricks are used having a crushing strength 70-200 kg/cm2 1or more. The
crushing strength of brick masonry construction depends on ithe quality of
bricks and the type of mortar used. The permissible compressive srrwlrth
^L^--
of0
the various quality of brick masonry against the type of m ortar ust
available in IS: 1905.
The common problem with brick masonry is the efflorescence W ~ L ., ,
caused due to leaching out of salts in brick or mortar. There is practically no

cure for this other than waiting till the leaching stops, plastering.the surface
after cleaning and washing the surface with turmeric water.
In many cases the brick work needs to be made waterproof. V ~ I
chemicals and products are available in the market which might be t
Silicone is one such treatment which makes the masonry W ~ L ",,C I
.&A"
L - L ~ ~ ~
This may be applied using a low pressure tree spray with neoprene washer
and hose instead of using a brush. Waterproofing mixture contains around
138 Construction ManagelI ICI I L I J Planning
3% of silicone resin solids. Brick is one of the most common building Ielement.
Commonly available varieties are common building brick, sand lime. vl -o,Aa l u ,
r
cement building brick (unburned), cinder brick, flyash brick, fac:e brick,
ceramic and glazed face bricks, paving bricks and sewer bricks.
Common bricks are used when the surfaces are generally finishea* wltn ...
plaster or similar material. These have got a lot of variety depending on the
crushing strength of brick and brick work which depends on the quality of
brick and the composition of mortar. The size of common bricks available in
India are 225 x 113 x 75, 250 x 125 x 75, 200 x 100
Machine-made module bricks are also available.
Sand lime brick are usually used for back uv I
and has pot a whitish cu~uur,
- -~
not preferred for load bearing multistorey ronstn inder an1d flyash
are now used for manufacturing bricks. These a:e compa~rativelycheaper
than common bricks.
Face brick is specified for use where a distincstive brick work finish is
intended. It is generally packed with care to protect from damages, its finish
is good and textured as specified and coloured as desired. Ceramic or
glazed-face bricks are used for distinctive brick work with a glazed finish.
They also reach the site well packed in cartons so as to prevent damage. It
also has a glossy or matte finish.
Paving bricks are tough, durable and evenly burned. When b:roken it
shows uniformly dense structure free from lime, alr . .. power
.-
. -,
s, etc.-1 ~
Sewer bricks might be made to have edges and curves to suit th.e shape
of sewer lines to be laid. These must also be strong and well burnec1.
In order to inspect the brick masonry work at site the following are .to be .
done :
, 1. 1Ill materials like 1)rick,con cks and c'lay tiles 2md the n
composing the mortar like sand ancd cemenl: or lime should be tested
in an approved laboratory.
L- J---
2. Sieve analysis of sand to vt. uulte at site belure LL -I:--
ule vrevarauurL -f
WI
mortar.
3. Bricks should be compared with cllF JvCLuILaUVIl rulU LUIVUIIIcU
pricks are to be re;iected.

8
oints shcluld be 1; r the specificatior 11emay Ele made

nd new ( ion shouId be con .fore app lportant
)oints alx ss of join.ts, type ( 18, the m :d, etc.
- ---
If lime is used in mortar it should be checked vvllculcI U L F L U L ~ is
Z high
c alcium qpick lime or hydrated Linne. In ca;se of high calcium quick

11ime which comes to site in powder J[ o meither pulverised or granular,
,onstruct/on ~ractrce11: Superstructure
it has to be slaked by adding water antd must 1 ?d to age

days.
rdrated lih e may be ordinary hydrated lime!or pressure hydrated
. Ordinm:y hydra1:ed variety should be soakced in waf:er at leasit for
.. .
L* l~ours befblC U3c. TJut
.urn -
for pressure hydrated llme ~tcould be s;a f e l xJr
..,.A
**LA
put :in mixture just like cemen.t.

6. Briclk laying should not be d one in M reather c eeze
mortar.
d should be checked and no void should 1 ed insidt: the
U~LLK
.--- . . .
work. Walls should be checked for plumbmg ana also ror 1.-
.
I P V .P ~--
, - 7
COUI
8. All 1 cept facEng bricks;should be thoroughly WI2t before use.

mj oints cornpletely filled with invrta~r. Mortar to be tro I the
end of brick and brick shored into plac:e.
Y. ~t snoula De checked that no more weignc or me raw uncK work is
. . T
-- --
laid at one time than the lintels, piers or other supporting memtbers
can carry without excessive deflection.
10. Where put log holes are left through the wa )port oul
scaffolding, these .holes are to be filled wit1 for the
thickness of the wall after these have served th Ise.
RAL STEEL
Tktc C L C L L L ~ Lof
~ ~ structural
~ steel are received at site m a readymade condition
suitable for erection. Assuming that steel has been inspected in the shop,I the
following additional inspections are done to make sure that the construc:tion
is in order. Members are checked against damages due to transportation,
su ~t plate, connection angles and member themselves. This is t:o be
dc e erection so that the rejection of an unacceptable member oc:curs
berore erection. Size, location, elevation and plumbing for the anchor 1bolts
are also checked. Base plates and grillages are checked for level and proper
grouting columns supported on the base plate, @ages or girders and
column splices are checked for bearing and milling. Care and attentic,n is
given to the sections where the column sections change the size. Plumbing
is checked before bolting or riveting permanently. Minor corrections are
made with s t e l strains. As erection proceeds, the members are matched as
per drawings. Usually the members are properly marked and there wi
less chance of committing mistakes. Even then random checking is cal
out as a rule;
The rivets and bolts are checked in a manner so thai .olesare filled
in and no hole is empty. These are also checked for s tightness and
the alignment of holes is checked before driving. If the alignment is not

proper, reamed and larger-sized rivets are used. It is passed only if it is tight
and has got a full concentric head. Burning of holes with torch, enlarging
unfair holes with drift pin and tightening of rivet by chalking are not to be
encouraged.
Rivets are tested using a small hammer and checked for any possible up
and down movement. Defective rivets are marked with chalk and while one
is removed since it loosens a number of adjoining ones, all loose rivets are
removed. Sufficient temporary bolts are used to hold pieces tight together
while riveting is done.
Bolted connections must be tight but not turned up so as to strip thread.
Washer, lock nut, etc. are checked thoroughly and carefully. Beams on walls
are checked for bearing and anchorages. Structures are safeguarded during
erection. Steel carrying derricks must be strong enough to bear the erection
loads and stresses. Overloading on crane is never to be tolerated. Guying
and bracing of steel in the process of erection are important so that nothing
happens for lateral loads due to wind or seismic forces. Painting should be
done according to the specifications. If the shop paint is removed during
transport, repainting is done before erection. Field paint must have a different
colour from shop paint. All steel must be free from rust and scale and also
must be dry. Painting is hbt done during freezing weather. The engineer in
charge of construction;brings to the notice of the inspector regarding
particular portions which needs special attention. The inspector must have
good idea of the design if he wants to do proper supervision.
WELDING
Welding is a specialist job, which needs a certificate to qualify The welder
placed at site makes test pieces or samples and get them passed by the
concerned authority before doing the actual job.
Conformity of the electrodes as per the specification, the condition and
capacity of the welding equipment, the quality of welds for overlap, colour,
porosity, slag inclusiond, under cutting uniformity, etc. are the different
aspects to be properly observed and certified. For fillet welding if gap is more
than 1.6 mm, the size of weld has to the increased.
Welding is to be done in a proper sequence in order to reduce residual
stresses. Jack welds if required to be fused with the final welds are thoroughly
inspected and if necessary are removed and rewelded.
Cleanliness is very important as good welds cannot be made on dirt, rust
or slag. In multiple pass weld, slag must be chipped and wire brushed to a
shiny surface before the next pass is made.
A welder must be properly protected from wind. This is not be done at
temperature less than O'F when surfaces are free from rain, snow or ice. At
ConstrU~tiorrrratiirtie rr. auperslrutiture
temperatures between O'F a n d 32'~, surfaces are heated. For material

m m or more thickness, 7 0 ' ~should be considered as the minimum t e r n p l d -
ture.
Cross-sectional size, length a n d location are t o b e done as per the
specifications. The length of the weld more than required might ''
unaccounted restraint a n d m a y affect the structure.
EXERCISES
7.1 Name the different types of cement available in the market. Write dow n the
special qualities of each of these cements and mention their field of applic ahon.
7.2 How is the chemical composition of cement to be ascertained? What a]:e the
tests run to assess the physical properties of cement?
7.3 How the aggregates, c,oarse and fine should be tested to ensure its suita bility
for reinforced cement concrete?
7.4 Write down the characteristics of water which make it suitable for uise in
reinforced concrete construction.
7.5 What do you understand by the word Adlrlixture? Why are these used? P\Tame
the principal industries who manufacture admixtures in India. Write in brief
the products they produce and their uses.
7.6 With reference to the manufacture of concreate define the following terms:
(a) Workability, (b) Seggregation (c) Bleeding.
7.7 What do you understand by (a) Strength, (b) Durability and (c) Impermeability
of concrete. How are these affected due to (i) Increase in water, (ii) Increzlse in
water-cement ratio (iii) Increase in aggregate cement ratio?
7.8 What are the steps required to be taken to, prevent distress in concrete in
aggressive environment?
7.9 What are the tests generally recommended to measure the tensile strength of
concrete? How are they performed?
7.10 What do you mean by creep and shrinkage of concrete? How do they affect
the strength of concrete?
7.11 Justify the statement 'Concrete mix should be designed before use'. Write c
briefly the methods of designing concrete mixes. with special referen~
IS-code method of design.
7.12 Name and write a few sentences on the equipment and man1chines us1
concrete construction.
7.13 How is the reinforcing steel used in concrete tested for tensile strength? 1Nhat
are the other tests required to ensure the suitability of steel to be us(?d in
reinforced concrete construction?
7.14 What are basic principles of Formwork design? How should the loads on fl
be assessed?
7.15 Name and write briefly the materials generally used for the formwork de
7.16 What is a slip form? Describe how a slip form is operated

7.17 Write short notes on
(a) Suspended forms and moving forms
(b) Moulds for precast concrete
(c) Scaffolding
(d) 'Structural steel
(e) Welding
Time Managen t and
Scl
IN'
A modem construction prdje!ct invohles a good number of acti~ rities such as
investigation, plann.in& schc?duling, and control at every stag1e. Beside's, it
might need the invc~lvementof a nun~ b e of r specialised agencie's and failure
of even one to deliver goods in due time migkit cripple the acti~
8 rity of otlhers
or stall the entire project. A close co-ordinaticm is net'essary bc?tween tllese
agencies and in case of the failure of one, pre-planned altemati7ve routes are I
to be chosen or new
.. ...
evolved such that other acctlvitles may
continue.
Modem techniques or project management are. maae - - ~ - l -.
use
- . C l
or oy managers
who deal with planning scheduling and control of tlhe projec:ts. Planning
involves the listing of jobs or activities that have to be done to :omplete the
project. The requirement of men, material, equipment, estimates .. . of cost as
also the duration of each of the activities are part of planning. Schedul
on the other hand, deals with the time order in which these activities ar
take place, as also the manpower, material, etc. required at every stagc,-
production should be shown in the scheduling. It is a common experience
that even after a lot of exercises on project planning and scheduling, no
project follows the programme exactly as chalked out due to unforeseen
reasons. An efficient technique helps the management tlo control the progress
of work as close as possible to the original schedu;le by re1~iewingand
..
reprogramming under the changed condition in order to adhere to the target
time of completion. The analysis and correction of thi Ice form the
basic aspects of control.
Whatever technique is adopted for the presentatisn of plan, prograinme

and schedule, graphic representation of the activities through diagrams is
found to be helpful to manoeuvre the project. In this connection, the
following four techniques of project management are presented:
1. Bar chart method
2. Line of balance
3. Critical path method (CPM)
4. Programme evaluation and review technique (PER"'
BAR CHART
In any construction project, men, material and machines are general1LY
arranged by the contractor in a manner that there is stead y progress of wor.k
according to the programme. The original programme of construction madle
by the consultant or the cIient might not be adhered to in to to durin R
constr~ction,since the contractor could not participate in dr afting tk.~e
programme as he was not seIected at that time. After the job is awarded, th~e
contractor is asked to submit a work programme, and he then submits it
taking into consideration his own problems and difficulties. This programme
may be submitted in tune with the original one suggested by the consultant
or he may modify it in a manner he thinks best for the smooth progress of
the project keeping in view his own constraints. The form, in which these
commitments are made, consists of certain dates by which certain jobs or
activities are to be finished. More detailed work would translate these dates
into a bar chart which presents the programme of work in a graphicaI form
and this gives the date of starting and date of finishing of each of the items
of work, overlapping of these items, chronological order of each item, etc. A
variety of forms of such charts are available. The choice of the most suitable
one depends on the type of the project work. Judgement is required to be
exercised to choose the correct one.
A typical simple form of a bar chart for a large multi-storeyed building is
presented in Fig. 8.1. The first column gives the description of each item of
work. The subsequent columns give the time in days, weeks or months
depending on the duration of each item of work. Under the heading time, it
is given month-wise for a particular year since the project is supposed to
continue for more than one year. Each of the items of wc)rk are sk\own by a
symbol indicating the date/time of start and date/time of finish. A!s the work
,-
progresses the actual work done is also marked below thc yluru~edtiming
-,.,.-m<
using a different symbol showing the 2~ctualstalrting time, actual finishing

time and the present status, if not fin~ished,i.le., the proportion of work
. ..-
--...--
completed. Thus the chart gives the folluwu~r utformation at a dance:
"
1. The date of actual starting of an 2 gainst the proposed date (Jf
starting of the same;
~ Time Management and Scheduling 145
Year 1990 Year 1991
Item Description
No.
24. Fire fighting drawings C+ I

4
25. Site clearance by client 4 b
requalification-ef-60~1t~acbrf~
(a) Pipe and basement
-
(b) Superstructure
C-,
27. Detail estimate for

(a) Pipe and basement I b
(b) Superstructure I b
(a) Pipe and basement

(b) Superstructure
lering and issue of w

c3rk order by client
)ipe and bzisement
d construc and
1 I lelluallllu all" lssua UI wuln UIUGI ~y client for

I
3. 8.1 (Cor
Year 1990 Year 1991 Year 1992
Item
Description
+
+
~ >o o w z r fr k j Z q- , ~~a aW +O > Ou W ~r L n ~ ~Q u
C L~ z ~ O
3 W
O Z O ~ L L ? ? < w o z o % D - r ~ r % ' ? < m
32.) Structure from plinth to roc +. D.
(eight levels) b
I
33. Brick work & door window fixing 4
I b
34. lntenial plaster & flooring
* b
I b
35. External plaster and painting I +
4 I.
36. lntemal paint & balance finish I -
-
37. Pre-qualificationI of plumbirl g and 4
sanitary contractor 4 +
late for sariitary work and c-

c-
a w ()val by clie
ering and issue of WIO by •
z
I ror sanlrary work
I
40. Sanitary and p l ~ rk
I of electrical
actor
ig. 8.1 (Contd)
Year 1990 Year 1991 Year 1992
Item
Description
No. ~ ~ ~ z ~ % ~
2 w $0 oz w ~ ~ n + > o z r
~ z o $ ~ ~ a ~ ? ? a mn ~ z 3o w % ~
42. Estimate for electrical work and 4
approval by client 4 b
43. Tendering and issue of WIO by 4
client t w
44. Electrical work (assuming #
concealed wiring) 4 b
45. Pre-qual~fication
of fire-fiqhting 4 w
work 4 b
+
------
ghting and 4
4 +
* b
ing & issue f client I b
.C b
hting work 4- b
IL
19. Draft t6!rider for lift and appn 4 b
-,I-- - A
alification cf ,r lift work

I
--
4
4 b
b
ng and iss *
4
Fig. 8.1 (Contl

A
P
w
Fig. 8.1 (Contd.)
Time Management and Scheduling 1 51
152 Construction Management and ~lannmng
2. The proportion compared to the tot,a1 job coinpleted;

,
3. The period of time (may tie expressea m aays, weelcs, or montns) vy
? .
which the activity is moving in advance or lagging behind;

4. The time by which the remaining work is to be done
The bar chart, though very helpful and popular for small projects, it has
got the following inherent limitations:
1. Bar chart does not depict the inter- ihip amo ctivities
showing their interdependence;
2. It does not consider the cost since .eject controlling method
which considers only time.
Line of Balance
Line of balance is a planning technique xly suitc2d for rempetitive
works like pipelines, multi-storeyed bui , row hc,usings. Line of
balance is basically a graph in which the p rogress of works :ire plotte'd in the
vertical axis and the passage of time is plot1ted in the' horizonital axis. P1s4mp1e
example clarifies the method. A sewer litxe can bt2 divideci into f01ar basic
operations, namely, earth excavation, lay.ing lines;, constnlcting m
and restoring the ground. The logic diagrism is prelsented irI Fig. 8.2
t, days t, days t3 4 t, days

-0
Earth Laying
w@-
Constructing
-49- 4
Restora~tion
work linc- manholes ~nrl Comnlntion
Fig. s diagram ( line
Each time period has a starting; date an(1 a completion da~ t and e tk\ere is a
time buffer between the starting and the completion of ea ch activity. This
.
information may be plotted in tne nne of balance diagram as
1 1. -
snown in t-
Fig. 8.3.
At any given date (say at the enc1 of the E5th day) one may draw a vertical
- --- - - ur
line and estimate the proposed prugress -1 1- c-. --
worn ule :
rrvrrl LL- -
uILersecnur1
' - ui
-1 L L -
ule
LA----c-.
- ~-
vertical line and the starting or completion date of the activities. TIle steps
for preparing the line of balance diagram are presented here:
1. Preparing a logic diagram like Fig. 8,.-. 7
2. Estimating the minimum ti^me requirement f~Dr each activity.
3. Estimating the proposed tinl e requirement for each ac'tivity to achieve
the schedule.
4. Drawing the schedule as sh own in E
5. Reviewing the line of balamce diag assess tlle possif
improvem--+c .X.ILLJ.
(ample i!;present e application.

Time Management and Scr w u u r r r IY
100 .
Fig. 8.3
! in days -
Line of balance dliagram
Exa 1 A corltract colnsists of 100 bo1red piles. The ac

assc ?formatic3n for each pile a re preser~tedin thke table h
Actiivity Descriptic mum No.

n per gan
4 B'oring 10
. *
erntorcem 12
C asting 15
'he time ovided hl me contract is rour we,,,. ,,,w a line
mce diag chedule the work;. Assum~
e data as
rtion:
CalculaticIn for line of balanc
-
Total 7
154 Construction Management and Plannini
In 1 the optimum gang size is given. 7'ime period per atctivity in

-- -
column (3) is obtained by dividing the man-days given m the problem by
column (2). Minimum buffer between the! completion of one activit!1 and the
commencement of the other is assumed 2is one da~yas shown in collumn (8).
The total time excluding buffer to complrLc.*A all ULZactivities, i.e. ont LrLlc
-11 &LC ".."1" .
operations, is 7 days. As the total allowable tinne is 30 days, 4 cycles of
operations can be made. Assuming the earliest possible sta~ roperations
t and
-..- Luulfer
considering the time period per activity and minit~tullt *-K time. one mav .
I
fill up the starting and completion of activities as shown irI columns (5) and
(6).The corresponding line of balance diagram is shown in Fig. 8.3. (3ne may
modify the schedules in many different ways and the line orr Dalance
l l -
aiagram
1. ~ -~
will be correspontdingly attendec
CRITICAL PATH METHOD (CPI
The bar chart method is suitable ror small projects wnere tne manager has a
clear idlea about:the mode of execution of each operation or activity. Elut when
it conc:ems a rtumber (~f technical trades the bar chart method becomes
inadequate ana neeas a more rational and scientific method ot project
planning and this is represented in a graphical form. The graphical repre-
sentation of the activities is called a network diagram or simply network.
This deals with events and activities and considers both time and cost.
A network depicts th~ ship between dif 'ferent activities by means
' of arrows in a logical se Events a re denott2d by nodal points which
...- -
indicate the start or finish of an activity b~ a rlwdp of activities. Events are
*"A..
denoted by circlLes. Thest2 are nunnbered fc)r easy identificatiion. An event has
no time dimens;ion of it s own since it gi ves the skarting clr finishhng of an
activity.
ictivity is;the actual work to be don e m alroject, ~ sc it must indicate
id resourres by arrows. is arrow has two functions: it indiczates the
- ?.-C ,,c
:
;wl L u l L c , and it gives the secjue~lce
L
-.- - ..> -..I..
of activlry :- dn
.:L-- . - . ...
vrueny .manner.
.
The following c:xample introduc,es and e xplains the ideas of eventS, nodal
points, arrows, ,activities, etc. Thct inter-re1lation of activities are presented as
"preceded by" 2ind "foll~ -- 3 , - - ~
____owes ~ y and
- -
" the auration
1 1 .. .. is given
.. or< eacn actlvity
in terms of days.
Suppose the project is, to instal s e t for 1 ; water. ?%ismay
consist of a number of activities, -'b"
Visiting s ns of dif ferent suppliers and select le pump
set.
g quotations frorrt differen
Time Management and Scheduling 155
(C) Purchasing the pump set.

(D) Digging the earth and laying the mud mat for the pumt, found;
(E) Construction of the foundation block.
(F) Fixing the pump set over the foundation.
(G) Installation of pipelines.
(H) Completing electric lines which could be done, say, after the set is
purchased.
(0 Providing electric connections and commissioning the pump.
The project details are shown in Table 8.2.
Table 8.2 Details of a project
Event No. Activity Time in days Preceded by Followed by

1 A 3 - B
2 B 7 A C
3 C 2 B D
3 D 4 C E
5 E 7 D F
6 F 2 E G
7 G 4 F H
8 H 2 G I
9 I 1 H -
Fig. 8.4 An anow dial
Figure 8.4 shows the arrow diagram,'each arrow indicatirig one of the
activities and are arranged in sequence to complete the:job. TheI nodal pcoints
or nodes are shown within circles. Each activity is glaced within two circles
or nodes known as the events. The time in days reqllired to zomplete one
(
activity is given below the activity on the other side of the arrc)w line. Now,
as per the arrow diagram the number of days require!d to con~pletethe job
is ( 3 + 7 + 2 + 4 + 7 + 2 + 4 + 2 + 1 ) 32 days.
But it is to be seen that from the nature of the activities, the activ
A, B and C are independent so far as the activities D, E, F and G are concerrleu
and these may go on simultaneously. Also activity H may be carried out
independent of D, E, F and G. I is the last activity to be performed to complete
the project. Accordingly, the inter-relation of the activities may be presented
as in Table 8.3.
Table 8.3 Inter-relation of the acti\rities
Activity Time in days Preceded by Follc

A 3 -
B 7 A C
C 2 B F
D 4 A E
n
E 7 F
F 2 G
G 4 I
H 2 T
It is now possible to redraw the arrow d iagram i~n the for1

diagram as in Fig. 8.5.
Fig. 8.5 Plot of a critical path
Dotted arrows are used to connect activity C witn k by activity C1 or G

with H by activity G1 as activity C is independent of activity F and activity
G is independent of activity H. The activities C1 or G1 are known as dummy
activities or dummies which do not need any time to complete but are used
to maintain the flowand interrelationship of activities t the dun~mies,
the network does not showr a completeness and it betcomes difficult to study
the network with a number of open ends.
It is interesting to note that in Fig. 8.5 tl-le activit:ies are sctgregatec1 from
each othe'r when they do rlot have interdependence but are I,art and parcel
. .. - - -
for the entlre job as a whole. If the route 1-2-5-6-7-8-9-10
- - .
is marked firmly ,
and the number ojf days re(pired to cover th is route i d it is seen that
only 21 days are Irequired to complete the job inste days which is
Time / L r a r r a y ~ r r r a r r ~a r r u ~ ~ r r e u u r r r r y
the summation of days for each job as shown in Fig. 8.4. This path will be
termed as the critical path, i.e., a path which is the longest path coverir.--11
16all
activities for completion of the project. If one looks to the previous example
more critically one can derive that the jobs B, C and H which are not o n the
critical path could be delayed or lengthened without changing the LL:--l l i l t :
needed to complete the project. It is now intended to show how the startand
finish times of certain activities may be changed without affectint5 the
-:.. el.
duration of the project. For the purpose, certain definitions and
applications are found to be necessary as:
1. Early Start and Early Finish Times

Early start time is the earliest possible time when the job can be]sin and nnight
be labelled as ES. Similarly, the early finish time of a job is clenoted 21s EF
. . .. . .
and is shown as EF = ES + t, where t is the time required to complete tnce 10".
Now, before a job can start all its predecessors must: have becen completed.
In the example, if activity B is to be presen:ted one may write I
EF(B) = ES(B) + t(B) = 3 + 7 = 10 days since B cannot start unless A which

- . -
takes 3 days is completed. It is customary to write the job within parentheses

( ) as shown or sometimes B may also be represented by the events shown
by nodal points 2-3, i.e., EF(2 - 3) = ES(2 - 3) + t(2 - 3: 1s.
Since the activity H could start independent1 ime aft€!r C,
E F ( H ) = ES(H) + t(H) = 12 + 2 = 14 days.
Similarly, the job C7 which is a dummy can onl: ?ed when its
predecessor C is ?ted. Thus, ES(1C]) = 12 2 ])= 12 since
:
t(C,) = 0.
ria-
.a- 6.6 Insertion of ES and EFin the arrow L
'he earlly start t:ime ES an d early finish ti

'I
.. .. move tne
side or,-..me actlvity
re denote:d just b1y the
.' arrow line as shown m rig..' n0.0.
,
lnis proce----
'dllT~
- I . - -
of startingat the beginning of the project network, calculating early start and
early finish times of each of the beginning jobs, repeating the same for the
successors and so on until all jobs are considered is known as a folivard pass
through the network. The activity H has beer1 shown after activity C. Hence
: and 14 respectively.
early finish and early start time for H are out;lined at 12
158 Construction Management and t ,, lY
It is now required to know how late the jolb H may !d and hc,w late
* . *.
the job H may be finished so that the project 1s not delayed and IS h nichorl
on time.
2. Late o r a l L an td Late Finish Ti1

Late start LS of an activity is defined as the latest time when it can begin
without delaying the date of completion of the project. Similarly late finish
LF of an activity is the late start time plus its duration, thus LF = LS + t. For
the activity H one may write LF(H) = L S ( H ) + t ( H ) which may bc? more
usefully presented as LS(H) = LF(H) - t(H). To calculafe the la.te start and late
finish times, it is required to begin at the end of the netwvrx 1- -.-- work
arid
backwards and this is known as a backward pass. In the example, s ince ~ I is
required to be finished in 21 days, for I late start and late finish are 20 and
21 days, but for H , LS may be 20 - 2 = 18 days and LF = 20 days. rm lnus
LS and LF for C are 12 and 14 and not 16,18 since LS and LF for F are 14 and
16 for B, 5 and 12, for G, 16 and 20, for F, 14 and 16, for E, 7 and 14, for D,
3 and 7, and for A, 0 and 3 respectively. If LS and LF for A are calculated
from B the values are 2 and 5 but this will delay the project by two days,
hence LS and LF for A should be 0 and 3 respectively. The late start and late
--
finish time for jobs are entered just below the arrow line in I-'
3. Total Slack T
-. . . .
~t1s now seen m pig. 8.b that there are jobs llke U , L;, t and G where la te start
and early start as also late finish and early finish are identical wheneas for
jobs like B and C these are different, e.g,. for B, ES(B) = 3, and LS(B) =:5 that
means job B may start on any day between 3rd and the 5'th day M rithout
disturbing the target time of the project. Thus, it is said that job B has; slack,
and total slack T S of B is T S ( B )= LS(B) - ES(B) = 5 - 3 = 2 dakys or
T S ( B )= LF(B) - EF(B) = 12 - 10 = 2 days. It is quite interesting to note that
when a job is on the critical or longest patE1 the delzty to start will delay the
project finish. Thus for all jobs on the critiical ,path the ES and LS, EF and
LF should be identical and there should be zero rural slack for each of these
L-L.
jobs. But when a non-critical job, i.e., a job which is not lying on the critical
I
path is delayed the succeeding jobs get delayed by equal length of timle, e.g.,
if job C is delayed until day 12 then its EF time is 12 + 2 = 14, the 14th day
and job H will be delayed equally, but if job B is delayed up to LF tinle, i.e.,
day 12, job C could have ES as 13, the 13th day. Total slack is also knc)wn as
total float in man
4. Free Slack F!
It is defined as tkle amou~ ~t of time a job can be dellayed wiithout ahfecting
the early start tirne of any other job. Thus, irI the example the activity,H may
Time Management and Scheaurmg iDY
be delayed by 6 days without affecting the ES time of activity I. It is the

difference between the early finish time of a job and earliest start time of all
of its immediate successor. Thus ES(H) = ES(I) - EF(H)= 20 - 14 = 6 days.
Free slack does generally exceed total slack. Free slack is also termed as free
'
float. One more example is presented to clarify ideas. A long example or a
real construction problem has been dealt with in Chapter 17 undc?rcase shudy.
Example 8.2 In an urban renewal consultancy project, tFLc .,-. lvuvv~ing

L.ll,.-.
activities and their interactions are given along with their duration in weeks,
(refer-Table 8.4).
Table 8.4 Activities and their interactions
Event Duration Preced

Activity
No. in weeks by
1. Finalising requirements of the A 1 none
authority
2. Organising and training of the B 1 A
socio-demographic surveyor
3. Socio-demographicsurvey C 3 B
4. Physical survey and preparation D 4 none E
of maps
5. Planning land use and infrastruc- E 2 ACE F
ture
6. Design of infrastructure, buildings F 2 E
and structures with drawings
7. Quantity surveying G 1 F H
8. Submission of the report of the H 2 G non
project
(a) Show the critical path with floats of all activities
(b) Find early start and late start of D
(c) Is there any free float of any activity? State it and its magnitude.
Solution
(a) F i p r e 8.7 shows the critical path of the project which is the path
A-B-C-E-F-GH (or 1-2-3-4-5-6-7-8).
(b) The floats of all activities are also shown. For the activity D early start
time = 0, and late start time = 1 week.
(c) Activity D has free float = 5 - 4 = 1 week.
Another method of arawing the arrow diagrams found in many references
is presented in Fig. 8.8. Here instead of writing early start time and early
fjnish time within brackets after each corresponding activity on top of the
line and late start time and late finish time below the line, one uses big arrows
within which these times are indicated. The event number is shown in a
Construction Management and Planning
bigger circle which is also partitioned and the duration of an activity is

written within the partitioned chamber as shown. The free floats available
for any activity is shown in a rectangular chamber in between two arrows
giving the expanse of the activity. It is to be noted that for all activities except
D the number zero '0' is entered within the rectangular chamber since these
have got no free floats. The number entered for activity D within the said
chamber indicates free fIoat for D is 1 week.
In conclusion, it is to be noted that the chain connecting the critical events
or the chain formed by the critical activities is called the critical path. Tl~e
critical path starts from the first event and after passing th;ough all the
critical path determines the project duration, the most optimum time to start
an activity and finish an activity, the interrelation between the activities, and
finally how the manager or the man-in-charge of the project should find out
alternative paths in case there is undue delay due to unforeseen reasons.
PERT
The programme evaluation and review technique is also presented in the
form of a network diagram whose logic is based on similar lines like CPM
but these two techniq~~es were developed independently and have got
distinct applications to different industries and settings.
PERT is preferred when there is some uncertainties in the choice of
methodology, availability of materials, and the final answer is not clearly
known, whereas CPM is applied when things are almost certain. As for
example, in the case of a construction project, once the project has been
finalised there is little doubt about men, materials and equipments required,
the time when these are required, and so on.
The duration of any activity in the case of a PERT programme is calculated
as a weighted average of three time estimates, namely the optimistic time
to, the pessimistic time tp and the most probable time t,,. Further, since it is
assumed that the most probable time is four times more likely to occur
compared to the other two, the expected time of completion of an activity is
presented as
to+ 4 f,, + tP
t, =
6
It is possible to plot an activity duration versus likelihood of occurrence as
shown in Fig. 8.9 and determine the expected time. This Fig. 8.9 is very close
to a probability distribution curve as given by statisticians and is presented
in Fig 8.10.
Referring to Fig. 8.9 and Fig. 8.10 let us assume that the most optimistic
time to of an activity is equal to say 4 days, most probable estimate of time
t,, is 8 days and most pessimistic time estimate is 16 days then the expected
time,
1 62 Construction Mana! 7d Plannir
3.67 say !3 days.
~- J u 8" . L
Activity duratic3n t (in d
tncy diagra
Fig. 8.9 A frequ~
nlsIlC esrln
t probable
,, - ,n,dcted time
irnistic est
4 8 9
Activity duration t (in days)
Fig. obability distribution
.., .,olllry or Activity I lmes

It is not only required to determine the average ? required
for an activity but it is also important to detf low relialble these
, . r .*
estimates are. In case of a highly variable time estimate, 11 me range of
estim# ate is ver.y large, the result obtaine!d may be less re1iable cotnpared to
that c~f a narcIwer range. In the above example, if three time estimates, to,
I
t , ana tP were to= 8, t

1 . .,
dm 1 I .
' = l u tnen also re comes out to D e equal to 9 1
and it is felt that this re5 ,re reliable because the variation is less. Thus
for the sake of confidc s required to measure the variability of a]
~ ~ + i ~ l itime
LaLLL" t y ' sduration. btandard deviation and variance are commonly use(
in sta tistics as 2s of var I'he vari:mce is siimply thie averagi
Time Management and Scnedul~ng
squared difference of all numbers from their mean v:due, e.g.,, average
6 and 11 is 7, the squared difference of these numbers fro m 7 i s (
(- I)', (4)' or 9.1 and 16. The average 9,1,16 is 8$ the variance. The startdard
deviation is the square root of the variance which comes out t.o be 2.94I.
. . E by
In PERT, the standard deviation St of time tp and to is simply ~ I V?n
St = ( t p- t0)/6. So that in the above example St = (16 - 4)/6 is 2 days. So the
variance which is square of standard deviation works out tc3 be
2
((t, - f,)/6) = 4.
Expected Length of a Critical Path
The expected length of a critical path should le sum 01 F the explected
times t,s of all the activities lying on a critic;11path. 7'hen the variance
equaIs the sum of all the variances of all these activitiles called VT. ST v
should be the square root of VT will denote! the startdard deviation c
project length.
Figure 8.11 presents the network diagram of a PEF:T progriunme coinsist-
ing of different activities shown by event nu1mbers. It is requir,ed to fin'd the
expected time t,, standard deviation St, and 1 Vt of eac r and
Finally to determine T,, V T , and ST. Tab resents t 2s of
,t St and Vt.
.11 Time estimates To, T m , TD
Table 8.5 Values of to, St and Vt
Expected Stand ard nce

Activity
n e t, deviati
I
-- 3, 5 18.50
n in Fig. I5.11 tha~tthe longest path c ?d times and hence the

cribcal pa& is 1-S5. With a length T, = 27.17 aays. lne variance in the cr itical
path is 4.02 which corresponds to a standard deviatic~ n St, = 2.
In conclusion it may be said PERT recognises unce!rtainty kty using three
time estimates which are reduced to one time estimate, i.e., the expected time
t, for calculating a critical path. This procedure is comparable to CPM
technique where for obtaining network information early and late start times
for each job, floats are used. But the standard deviation for each activity and*
for the whole project used in PERT gives the manager additional information
about variations which he may guess well ahead of time of incidence and he
could take up necessary steps to cope with this variation.
PERT Cost
PERT and CPM were time oriented when originally developed. Cost was not
a major consideration for early projects launched by NASA or Du Pont.
However, cost is an important factor which cannot be ignored and soon
became an integral part of network analysis. An example to illustrate how
the network analysis can be used to manage project funds are presented in
.,
the following:
Fig. 8.12 Time and cost of each activity
The time t in weeks and cost in thousands for each activity are presented
in Fig. 8.12. The earliest and latest start times and the fund requirement for
the network is presented in Table 8.6.
Table 8.6 ES LS and fund requirements
Total cost' Cost/week
Activity Duration
(Rs) (Rs)
Time Management and Sche
The project analyst has an option to guide the project either oni early st:
or on late start basis. In both cases, the project could be finished within t
time schedule. The weekly requirement for early start an d !ate sta rt basis a
presented in Table 8.7 and Table 8.8 respectively.
The cumulative fund requirement for schedules based on early and le
start basis is presented in Fig. 8.13.
Time
Fig. 8.13 Cumulative fund requirement
Figure 8.13 shows that the scheduling of the project on late > L ~ Lvasis
reduces the average commitment of funds spent on the project f'or the fiirst
few months. The project schedule can be maintained in b~0th cases. Howevler,
- .-- - .. .-
general network analysis assumes that the activity durations are not delay1ed
wilfully. In such case, an intentional bias introduced in the network increa
the risk of duration of the network. A simulation study discussed elsewhe
shows that the standard deviation of the project durations, i.e. the risk of tl
network durations has increased considerably.
RESOURCE CONSTRAINTS
In the network analysis presented so far, it is assumed that any E

begin as soon as the preceding activities are completed. In practical applic
- -
tions, the assumption hardly prevails. The planner prc~bablyh;IS resour
limitations to start all possible activities at any one timeI. The pkinner fin
that the short supply of material, machine, labour, fmance or other resourc
may create a bottleneck so that an activity has to be deslayed. Si
ments are made in network analysis with resource consf :raints.
Tat he weekly1 requiremtent of early start A
0)
0,
(Money in thousands)
Weeks
2
2
Acti vity -
Total
--
Cumulai
1 -
Resource-constrained project schedules are theoretically complex to opti-

mize. Firstly, the critical path may not be feasible due to constraints.Secondly,
the proposed resource constrained schedule should be of minimum cost.
Thirdly, the analyst in a real project may be confronted with numerous
constraints,that may occur in different tiiies causing synergistic effect.
Algorithms for the optimal solution of resource constrained problems
have been proposed but these are computationally very large and cumber-
some to be practical for our purpose. Heuristic programs for managing the
resource constrained schedules have also been developed. Heuristic
programs are really rules of thumb that work effectively in a given situation.
One such heuristic program is presented in the following:
Step 1: Rank all resources from the most important to the least important
and number the resources i = l , 2 , 3 . . . rn.
Step 2: Set the scheduled start time for each activity to the earliest start
time for each resources i = l , 2 , 3 . . ., m in turn.
Step 3: Start at the project beginning, so set t = 0.
Step 4: Compute the demand for resources i at time t by summing up the
requirements for resources i for all activities scheduled to be underway at
time f.
If the demand for resources in time f is greater than the resources
availability, then select the activity with the greatest late start time requiring
resources i at time t and shift its scheduled start time to time t + 1. Repeat
the process until the resource constraints at time f for resource i is satisfied.
Step 5: Repeat step 4 for each project period in turn, setting t = t + 1.
The algorithm is used in the following example. The network is presented
in Fig. 8.20 and the relevant data is presented in Table 8.9
Table 8.9 Data of the network
Workers Equipment Earliest Latest start
Activity Duration
required required start time time
- - -- - - -
A 2 0 0 0 4
B 2 1 0 9 3
C 2 1 4 4 8
D 2 1 4 15 7
E 2 1 12 13 9
F 2 0 12 12 12
G 2 1 21 22 2
H 2 1 21 25 5
I 4 1 23 24 6
Graphs of resource requirements like workers and equipment required arc
presented in Fig. 8.14 and Fig. 8.15 respectively. Equipment availabili? is nct
creating a bottleneck in this schedulr. However, workers availability 1s
exceeding the maximum limit of 4 twice on 21st and on 24th day.
Time Management and Schec
- -
$2
$4- - -
P
2 - -
b
0 5 10 ?I 25 30
Day
Fig. 8.14 Labour requirement
Days
Fig. 8.15 Equipments requirement
On 21st day, activity F. G and H are scheduled to be in operation requiring

six workers as shown in Fig. 8.14. Applying the heuristic algorithm one ma
reschedule activity H since it h;3s a greater late start time (i, j) that is day 2
versus day 22 as shown in Table 8.9. On 28th day, activity H is complete^
and 4 workers shall start activity I and complete the project in 34 days.
One may notice, that a resource constraint of 4 workers is delaying th
critical time from 30 to .34 days. The revised workers requirement is presentel
in Fig. 8.16.
TIME COST TRADE OFF
Under the CPM system, two estimates, namely n ~dcrash, are mad
for the time and associated costs for each activity. For many activities, co:
per unit increases if attctmpted tcI be exec1uted in sllorter tinle period as show:
in Fig. 8.17. The rate of increase could tal<evariouIs forms 21s shown in curve
170 Construction Management and Plannlng
0 5 10 15 20 25 30 :
Days
Fig. 8.16 Labour requirement under revised schedule
Crash
-CO
Normal
ime
1.8.17 Ti1me cost re1ationship
(11,\L) an :ig. 8.17. However, a linealr relationship as shown in curve

(2) is a good approximation m most cases.
Assuming a linear tim~e-costrelationsh nal and crash
estimate, one may. represel~t a network thro ttions of linear
relationship with r&A.-'.; u ~ r~n rr 4~constraints
v o i and tiereby obta~nan optimal' , cnl**-
,
,
,
tion with the application of linear programn example is provided in
the following.
A network that would be optimised is pre3c~lrcu ~1 Fig. 8.18.and Fig
a .
The ncjrmal tinIe and crash time for activities are presented in Fig
atnd Fig. 8.19 res,pectively. The critical path travels through A, C
I .-..... _ 1lne
acnvmes. 1. -
crirical time is 16 weeks and 10 weeks for normal and L L ~ ~ L
_..:L
,
programme respectively. 'The tim€ and cost relaticmship ojf the activities
b
shown in the n e brork are presentec in the 'rable 8.1(I.

Time Management and Scbnllnnn
Fig. 8.18 Normal time estimate Fic ,ash time estimate
Table 8.10 Time-cost relationship or m e ncetwork
Time (weeks) Cost Cost tc

Activity -- reduce p
Normal Crash Normal (Rs) Cra:sh (Rs) week (R
A 0.0 4.0 10,000 14,000
B 4.0 3.0 5,000 8,000
C 3.0 2.0 4,000 5,000 -,--.
D 8.0 6.0 9,000 12,000
E 7.0 4.0 7,000 8,000
Rs 35.000 47.000
The objective function for linear programrn
where YA, YB, YC, Yo and YE are the number of weeks by which the time
can be reduced for the activities A, B, C, D and E, respectively.
The network is re~resentedas follows. The time for each event 1, 2, 3.4
and 5 is denoted by X3, X4 and X5 res. : A typica1 event
event 4 can be repre: J
Completion lvurrnal Number of The st; ...
time of , 2 time for - Cis reduce' - time 01
event 4 activity C crashing event 4
or X423-Yc+X2
Similarly, the whole network is represented as follows:
x3>4-yB+0
I-.'2- Yc+q
+ x4
K ~ L ~ ( - Y ~ + X ~
The five equations n 1 above represenlt the net1 .e event !
172 Construction Management.and Planning
described with two equations to translate the network diagram. In cas

. dummy activity, the dummy is required to be shown as greater than all LILC
previous activities for which the dummy is used.
The constraints to represent the maximum crashing possible can be
obtained from Table 8.10 and is presented here: .
YA12,YB<1,Yc<1,YD<2,YE<3
The final constraint is the total time that is allowed to complete the project.
The critical time for crash programme is 10 weeks in this case. The cons
for completion time is
X, I 10
In case, the project is allowed to complete in any designated time bei
critical normal and crash time, i.e., between 16 to 10 weeks the X5 s h o ~
adjusted as required. For example, if the completion time is assumed to oe
12 weeks the constraint would be
x5I12
The linear programming formulation for the example problern is presented
in the following:
hlinimise
2000 YA+ 3000 YB+ 1000 Yc + 1500 YD + 333 YE
subject to
x226-YA+o, x324-YB+o, x423-Yc+
X527-YE+X4, X528-YD+X3
YA1 2 , Y BI1, YC 1 1 , Y D1 2 , YE 1 3 , X
Computer programs for solutions of linear programming b nplex
alogrithm is widely available. One such program, Lindo, is usea to o ~ t a i na
solution for the above problem. The optimum values are:
YA is 2, YB is 0, YC is 1, YD is 2 and YE is 3 and the value of objective
function is Rs 9,000/-.
If the project is allowed to be completed in 13 weeks the cons
X5 5 13 and the computer solution is:
YAis 0, YBis 0, Yc is 0, YDis 2 ajnd Y Eis 3 and the value of the objc
function is Rs 1,000/-.
One may study the mechanism of optimisation intuitively. An inspecti,,. ,.
the Table 8.10 indicates that the cost to reduce time per week is iowest for
activity E. Naturally, the linear program has suggested to crash activity E tn
full amount to reduce total time from 16 to 13 weeks. This is the least cost
means of reducing time up to 13 weeks. On the other hand, the table indicate:,
that cost to reduce time per week is maximum for activity B. Therefore, thv
Time Manaaernent and Schedulin
linear programming solution has left the activity B ur touched while crashing
the network to 10 weeks.
Such intuitive approach is applicable only to example problems. The real
life networks are usually large enough so that only a computer solution is
the practical method to optimise a network. For example, a small network
in practical life has been analysed in chapter XVII. There are 38 events and
the number of constraining equations are 86. It is not uncommon to
encounter networks having more than 100 events. The constraints may
amount up to 1000 equations. Under such circumstances, only the computer
techniques as proposed in this discussion is an effective tool to optimise the
time-cost trade-off.
UNCERTAIN DURATIONS
The common approach to incorporate uncertainty in the scheau~lngFjrocess
is to apply the critical path scheduling process with a probabilistic time
. period. The process is usually referred as PERT and is already discussed.
Although the PERT method is widely in circulation it has two major
problems. Firstly, the procedure calculates the probabilistic time period of
the critical path only while it is entirely possible that other activities might
be so delayed that a new critical path- is created through the delayed
activities. PERT does not address to sucl~problems.
Secondly, PERT assumes that durations are independent random variables
having a beta probability distribution. The durations are correlated with one
another. For example, difficulties in obtaining cement delays a number of
activities in a site. The assumption of beta probability distribution for activity
durations may not be true in practice. In many projects, the network is
already crashed. Therefore, the difference between optimistic and most likely
time is very small if any, whereas the pessimistic time is long due to the risk
and uncertainty of the constn~ctionactivities. In other words, the probability
distribution of the activity durations is skewed as opposed to an evenly
distributed beta distribution assumed in PERT, Sometimes the probability
distribution of activity duration is a function of the season. For example, the
pessimistic time of an earthwork may be two months if started in winter,
whereas the pessimistic time of the same earthwork might be three months
if started in the rainy season. Beta distribution for activity durations are not
applicable in these cases. PERT typically underestimates the project duration.
As an alternative to PERT, a method to estimate the pro'bability distribution
- of the time duration and other information like cost for a network can be
obtained from the Monte Carlo simulation. This technique calculates the pro-
ject duration number of times from the artificial but realistic data randomly
chosen from a given distribution for each activity duration and applylng a
critical path scheduling to the resulting network and finally calculates the
mean and standard deviation of the project duration to obtain a better insight
about the risk of the project duration.
An example is provided in the following. Ac )r a nine
activities project is presented h Fig. 8.20.
Fig. 8.20 An activfity network
The activity duration estimates for a nih e activities projc

i.11.
Table 8.11 Activity duration for the nine iactivities F

Optimi Lost likely Pessirnistic
Activity durati iuration duration
a m b
3
2
6
U 5
E 6
F 10
G 2
H 4
I 4
An algorithm to determine the critical path in a network is pres
Table 8.12.
Table 8.12 An algorithm for the critical path
base I: Event n umber algorithm
-
Step 1:
>rep L:
0,
Starting; event number woi
luext. number would be assignea to any unnumbered e7
x 7
which each of the predecessor event

. Phase. 11: Earliest event time algorithm
-
Step 1: Let E(0)
Sfep 2: For j = 1 , rz (wherc n is the last event) let E(j) = maximur
Time Management and Scheduling
E ( i ) + Dkj, where, the maximum is computed over all activiities

(i, j) that have j as the ending event, and
Earliest sitart time for a network.
:
Duration of the act:ivity (i, 11.
Step 1: Let L(n) equals the required completion time of tll e project and
L(n) is equal to or exceeds E(n).
Step 2: .,. .-,.
For ;= n - 1, n - 2, ..., Olet
L(i)= rninimum L(j)= Dij
wrhere the Iminimum is compulted over i311 activities (it1) th;~thave
--.LL.. ^'.
i aa ulr ardrting event.
Phase IV:
Step 1: Events which have equal earliest and latest time, i.e., E(i)= L(i) lie
on the critical path.
Step 2: An activity (i, 1) is a critical acl satisfies tihe followi
condition:
E(i)= L(i)
E(j)= L(j)
E(i)+ Dij = I:(;)
The algorithm in Table 8.12 is applied to the exam]ple netwcork presc
in Fig. 8.20 and Table 8.11.
Earliest event tirne:
step 1. f:(o) = 0
step 2.
j = 1 -., E(l) = max (E(0)+ Doll
= max ((0+ 4))= 4
:(2) = ma:K HO) + Do2; ECl) + Dl21
= ma:K {O+3;4+8)=12
i= a --t
,(-\ -
L~J=
- -.
) IndX (E(1)+ Dl3; E(2) + D m )
=max(4+7;12+9]=2
i = 4 + E(4) = max (E(2)+ D24;E(3)
u{12+12;21+2]=24
j=5+E u 1E(3)+ 4 . 5 ; E(4) + 0 4 5 )
= IIMX {21+5; 24 + 6) =
The minimum ti mplete the network is 30.
Latest event tirnt
vvr ,,,ion Management and Plannin
= rnin (L(
.
= min (3U - 6)=24
= rnin (L( L(4)- 0 3 4 )
= rnin (3C -2)=22
= min {L( L(3)- 4 3 )
= min (24 - 91 =12
= rnin {L(3)- u 1 3 ; L(2)- Dl '
j = 0 + L(U) LL,u, ,u,Z)- LJ,;1

= rnin (12
The activities are tabulated in the Tat:
Table 18.13 Act ivity detai
arliest Latest Late:

start timce finish t
LS(ij) L(j)= L
4
- I\*,
The critical path passer I the pounts whene slack, i.

-
. ., r n .. ...
"-I
zero as shown m me tame 6.13. rne act~viriesfor whicn me condition
E(i)+ Dij satisfy 1ies on the critical path as ed in phi e
nted in Table 8.14
ritical patt
ctivity 'ij E(
' and Scht
The critical path of the network is thus determined. The duratic

presented in Table 8.14 are used for a PERT analysis for the critical path
Table 8.15 to determine the mean and standard deviation of the expec1
time and is presented in Table 8.15.
Table 8.15 PERT analysis of the networK
Variance
Activ 2 (b -a12
40, 111
C(1, : LAA
F(2,
1(4, E
Tota
he m e x , variancc ndard de viation o
jays respectively.
The Monte Carlo simulaticIn point:; out to the different estbnate of 1
project duration. In case of a simulation, the duration for e a d1 activity is
-..,.
selected randomly from.the ~ L U L S Cp ~ f v i d e d
-...-A
in Table 8.11. The CIILILQI ...;+:,--I --
ydth
duration is determined by an algorithrn like thc? one presented in1 Table 8.12.
The procedure is repeated for a large number of times. The me!an and the
A.*..-&:-..
standard deviation of the critical path uulauulr . -..,.-.:A*
LJLLJVNLZ~ mate of the
variability of the critical path duration
In this example a simulation for 5010 times i:5 run on the assulnption tl
activity durations are normally distri~ureu L-.L-J
with the lrleilll ---- a--r l-1u ~ L ~ I I U C
-L---1-
deviation derived from the data presented in Table 8.11. The mean and
standard deviation of the critical path duration is found to be 30.'9 days with
a standard deviation of 2.5 days. The critical path considered in PATH, i .e..
ACFI is found to be the critical path in. the simt ss than h
the time.
.. ..
If there are correlations among the activity aurations, tnen significan.-, tlv
different results can be obtained. For example, assuming thzit activities
C, E, G and H are all positively correlated random variables with correlation
of 0.5 for each pair of variables the mean and standard devianon or 1.he
.. r .
activity durations are 36.5 days and 4.'9 days re!spectivel [YO
In this case, the PERT analysis has underestimated the proje'ct durati
.for a considerable amount. An example is provided in the tollou-.,.
. .- ,line..
The activi~tydurations are assumec ~ormallydistributed in bc
PERT and s inulation
~ results. 'f i e probability ojf the acti~ ~itydurations for
- - - -- - - - - -
days are calculated for all cases with the help of standard normal distributi
table and is presented in Table 8.16.
II
Table 8.16 Comparison of activity duration estimates by different methods
Distance Probability of
Analysis Mean Standard from mean completion
deviation
p
32 - w)
PERT 30 1.2 1.66 95.1
~imulation 30.9 2.5 0.44 63.3
Simulation with correlation 36.5 4.9 0.92 17.9
In the example shown in Table 8.16, the probability of completion is high
in the PERT analysis but quite low in simulation results.
PROGRESS REPORT
Construction time control is a difficult, time-consuming and an arduous
management function. A high percentage of the projects in India both in
private and public sectors are not finished in time. The situation is a
testimony of the difficulties of the project time control.
Truly, the project analyst only monitors and guides other site managers
about the time frame of the project. Therefore, communicating the project
schedule is the vital ingredient in successful project management. Numerous
parties like contractors, sub-contractors, consultants, owners and suppliers
are inx~olved.Even an individual party like a contractor's firm is in reality a
mixture of different layers of decision makers like directors, managers,
foremen and supervisors. All of these parties are required to be within the
communication link for the successful implementation of the project
schedule.
Early softwares produced technical information like floats, early start
dates and late start dates in tabular forms. Such numbers in quantities created
confusion and the lack of appreciation among the parties involved resulting
in. non-cooperation and subsequent failure of the time management
programmes. Manual drafting of graphics were tedious and delayed for
decision making. Present softwares in microcomputers generate graphics for
an easy understanding of the situation. Whereas graphics are better suited
for explaining the inter-relationship among the factors, tables and charts are
required to pass information in a detailed level. The project analyst arranges
a plan so that a project personnel receive only the appropriate information
required by him. For example, a site manager receives the macroscopic
information about the present status of a project including financial and other
resources position. Detailed dates of the work plan are not important to him..
An electrical supervisor on the other hand receives only the proposed
electrical work schedule with detailed dates that is expected to be delivered
by the supervisor. Network diagrams for projects have already been dis-
cussed. It is a visualization of the precedence and relationships among the
Time Management and Scheduling '
various project activities. It is a common tool of communicating the project

plan among the concerned parties. One difficulty with network diagram is
that the presentation tends to be crowded if all information is included. A
practical solution is to summarise the network by defining a set of activiities
by a single macro activity and presenting the basic network only with the
macro activities. Each of the macro activities can later be elaborated writh
other network diagrams.
Another variation of a network diagram is to produce a time-scaled
network. Activities are plotted in a horizontal axis measuring the W e . The
time frame of a particular activity can be immediately determined from such
a diagram. The network shown in Fig. 8.20 is presented in a time scale
network in Fig. 8.21.
0 10 20
Days
Fig. 8.21 Time scale network
Bar charts have been already discussed. Bar chart is not an adequate
planning and scheduling tool because it does not provide information about
the critical activity, floats and resource planning. However, bar chart has a
visual clarity to explain the job schedule to various parties. It is a convenient
way to record both the job progress and the job schedule. A number of
variations have been proposed in bar charts to accommodate further inf
mation.
Bacl
Test
Locate and C
0 1 2 3 4
Fig. 8.22 A modified bar chiart

I -
0
w
C
G
loo
-aa, 75
Early Start
/
-
:e Start
hedule
Fig. 8.23 Comparison of ES and LS schedules
Original LS Revise
Schedt
Schedule
vveeK:3
Fig. 8.2!4 Comparison of various schec
loo Early Start

-0
Schedule ,
, a,
.(
E 75
>E
.-
3:
z0 50 I Late Start
3 Ul
Schedule
z25
1
0
eks
ule relationship
Fig. 8..25 Fund and sched~
Vorkers
dequirements
Maximum
Workers
Available
6 8
'eeks
Fig. 8.5 rs required versus tim
For repetitive operations such as canal lining, a modified bar chart can be
prepared. An example for a pipeline relocation is presented in Fig. 8.22.
'
Other graphical representations can also be successfully used in explain-
ing the project status. These graphs are normally better appreciated by
technical personnel like engineers or specialists and accountants who are
used to take decisions from graphs in their professional work. For example,
several graphical representations are presented in Fig. 8.23 to Fig. 8.26.
In Fig. 8.23 and Fig. 8.24, the horizontal distance between the early and
late start schedule gives an idea of floats in the project. In Fig. 8.24, the project
is delayed. The horizontal distance between the original and revised delay
gives an idea of the delay occurred in each stage of the work. In Fig. 8.25 the
vertical axis is replaced by the funds required in lieu of the percentage of
completion. The vertical distance at a given time period would point out to
the funds saved by guiding the project by a late start schedule. In Fig. 8.26,
the workmen's requirements are plotted to investigate manpower planning.
Charts and tables are essential in micro levels so that the site engineer and
his subordinates can plan and organize for the execution of the work in time.
The absolute days are normally translated to calendar dates after considering
the holidays. Owners and top managements are satisfied with abridged
schedules of the key dates and milestones. An example of a key date schedule
is presented in Table 8.17.
The actual columns of the table shall be filled up along with the progress
of the job. The detailed schedule might have much more information. For.
example, a detail schedule for a footing is presented in Table 8.18. The aph1-l
columns are filled up according to tl ess of the work for monitc
and analysis of the project.
.I7 Exarnple of a key date .schedule

Projec
Schec
Finis Start
Move in
Footing no 2
Footing no 2
Abutment no 1
Deck
Finishir
?tail schec
Act - J ..- ~~
Actual
ipletion - Free f
Description No Duration Start Dl $

-
~rk
LC11 C I 1 . l " \
- --
Formwcjrk
-
Casting
-
Progre:ss Analy
d . ..
lhe network diagram and the cntical path are generally determined before
I
the cornLmencement of the job. In the execu ;elschedules are prepared
from th~ e existing5 critical path and the actua1 progre'ss are monitored through
- .
the progress reports collected from the site. bstnnated activity durations used
in the development of the critical 13ath may vary in the actual execution stage.
Numerous factors may alter the estimate!d activity durations. Apart from
-
major reasons like change of plans, paucitv of funds, labour unrest and
scarcity of matetrials, tht?re migh t be deli3ys for 1)ewer sh.ortage, Inachine
availabiility, stat utory in.spection, technic:a1 investigations and nuunerous
. - -
other unavoidable reasorIS.
The project alnalyst first determines tlIe status of the project from the
progress reports received from the site. As long a: ; the critical activities are
1:nL-A ..I
QLLVILLCIIIDILCU U? their scheduled finish t k ~ r a&L-*
u~aie
, is no problem with the
project Itime goa:1 insofar as the cu.rrent criiical path is concerned. If e1 critical
activity is delayc2d, the cc~mpletio: n date is delayed commen~surately.
In such a situation, a new critical path is created. There might be a number

of ways for corrective actions. The activities can be crashed. Portions of the
critical activities can be assigned to the sub-contractors to enlarl;e the'
resources committed to the project. Critical activities can be re-stud--- id .-
tn
create if possible an alternative path. For example, critical activities can be

subdivided and run in parallel. A change in specification or relaxation of a
standard may allow to shorten the critical path. The reduction of critical
duration invariably increases the associated cost that is requir ;ha red
according to the provisions of the contract.
Once the corrective action is proposed after the analysis of the delav a new
schedule is prepared and passed to the site personnel as a re!vised scl~edule
and thus the cycle of progress reports and schedules are colntinued itill the
completion of the project.
COMPUTER APPLICATIONS
Network analysis involves many repetitive calculat~~~ts a t u 1s paluCulalIy
suited for the use of computers. Since its early development and applications,
computer techniques were an integral part for operation research methods
like linear programming, Monte Carlo's simulation and network an-'---'-
Although manual methods are successfully used, nf nalysis ir
tice is almost impossible without computer aids.
- 2
The present-day revolution of information technology nas reaucea me
~~
I price of personal or micro computers within the reach of mc st firms in the

construction industry. A situation is created to use projec:t manag;ement
techniques widely.
Therefore, project management involves i3 lot of ccpmputer.work. A 1project
analyst is required to spend a considerablc2 amount of timeI in evahlation,
. . * . .
maintenance and management of software systems which is beyond the
scope of this book. Numerous commercial prograrr1s are ah;o availalble for
construction project management. Such cornrnercial progran1s along with a
few tailor-made support programs are sufficient for most project analysis.
The scenario in computer programs are rapidly changing and information
about commercial computer programs is bound to be dated within a short
time. However, a few of the commercial programs in the field of project
management are presented in Table 8.19 as reference. The detail program
listings of these softwares are not available for commercial reasons. The
alogrithms for solutions are mentioned so that a user is, aware 01 F the
Most commercial packages have the following parts. Thce main F)ortion
consists of the algorithm similar to those discussed in the chapter thelt does
the basic calculations. The second part deals with the interaction w ith the
user. These programs are menu-driven and user-friendly. A user can follow
184 Construction Management arid Planning
Table 8.19 Examples of commercial computer software for project management
Name System Scmrce

1. PRISM Main frame 'onsultanc:y Service:
2. COMDACE Main frame -
Davy computing, -u-. K-- . /.-lechnova
Inforn Delhi
3. Harvard Project Manager Mi cro NIIT
(HPM)
4. Qwiknet Professional Mi PSDI, USA/Integrated Pr
Managcement, NI. Delhi
5. PROMIS Mi 40-
6. Business Planned Micro Tata Consu~tanc
7. Instaplan Micro WIPRO
8. Proman Micro M.N. Dastur &
9. PROWARE E v -
uter Home, Calcutt
and answer a s sked by the prog:ram to sc3lve the .problem.
At any time, the program nelps .tne ,
user witn.., rurtner
r . ana comments
., .tips . lr. <
asked by the user. Therefore, a user with relatively little effort can master
and use the programs without any special knowledge about computer
programming. Lastly, these programs have various presentation capabilities.
The output can be prepared in differenlt forms including graphica1 repre-
sentations. For example, an output might consist of a bar diagram, a network
. *,
diagram, a histogram and graphs. No separate ettort is necessary to present
the output. Apart from the hard copy reports, the outplut can be stored
electronically for future use. The output in some calses can a~lsointerface with
other programs like PROWARE EX forming an integrated system.
primary input for the programs ar ;duration and its
depenclence over other activities. The otkker inputs are cra:;h time, 1:ime-cost
ALZ...~,~~and essential resources.
The prograrr1s primarily generate end Ievents, p roject du rroneous
4
input 1ike forming dead 100ps, floats, crit ical path, early an. irt dates,
- -
etc. Wiul ayYlupriate inputs, the progran~" -

-^^^..-,
re~lrlatesthe tiiltc-LU~L .-- A - -LC
LICIUC-UU.
the risk of time duration, the resource re(piremen~tand levelling.

The output may consist of a bar diagram, a network diagram, cash flow
curves, and various reviews about time tutu --A
lesuurces in order to Irturulur
---a
and gulide the project.
ES
3.1 What is a bar chart? What is its weak]ness? Why is it wiciely used'? Give an
example.
Yhat is a I liagram? What is tl- !n CPM a1~dPERT?
Time Mahagenrent and Scheduling 185
8.3 Explain the line of balance diagram. Colmpare bc!tween bar chart, line of
balance and CPM.
8.4 What is the PERT Cost Method? Why a contractor tertds to adopt the 'latt Istart'
means? Explain with an example.
- -
8.5 Explain why resource constraints are iimportant for optirnising ne

schedules.
8.6 How linear programming can be used in optimising time-cost trade-o
project schedule?
8.7 Explain how PERT is used to estimate tl ain duration of a 1
network.
8.8 Explain why the simulation method is an i~mproved Imethod for estimating the
uncertainty of a project duration.
8.9 Discuss the importance and various methoc3s of repolrting progress of a p roject.
8.10 Explain why computer s e ~ i c is e a better means of progress analysis.
8.11 A watchman's goomty having a plinth area of 10 sq. m and consisting of load
bearing walls, R.C.C. slab internal and external plaster with two coats of paint
d IPS flooring is required to be finished in 45 days. Identify the activities
d draw a realistic bar chart.
L.-, .. project has the following schedule.. Construct the PERT network and
comipute the earliest sta rt time for (?ach activity.
-
Activity Time iiI weeks Predect
-
A 3
B 2
C 4
D C
&.la n project nas tne rollowlng scnec
Activity Prec Time in

1u u , , c
None
A
B
B
c, D
E
E
G
H
Construct a PERT network and compute an early start, a late start and slack
time for each activity. Find the critical path.
8.14 A project has the following characteristics:
Most Most Most

Activity optimistic likely time pessimistic Prede-
cessors
time in weeks in weeks time in weeks
A 0.5 1 2 None
B 1 2 3 A
C 1 3 5 A
D 3 4 5 B
Construct a PERT network and compute the probability that the project will
be completed within 30 weeks.
8.15 Consider the probIem given in Fig. 8.3 and reschedule the line of balance
diagram so that the job is finished on the 29th day and the slowest possible
rate of progress of activities can be achieved.
8.16 A project characteristics are presented here:
Activity Predecessors Duration Workers/day

A None 3 9
B None 5 6
C None 1 4
D A 1 10
E B 7 16
f B 6 9
G C 4 5
H C 3 8
I D,E 6 2 '
1 F, G 4 3
K H 3 7
Suggest a project schedule that completes the project in minimum time and
results in relatively constant or level requirements for labour over the course
of the project.
8.17 A project has the following characteristics:

Time (weeks) Cost (Rs)
Activity Predecessors
Normal Crash Normal Cras
A None 3 I 11000 17000
B A 6 3 6000 9000
C A 5 4 3000 5000
D A 8 2 7000 3100
Use linear programming software and crash this project to its mini^..^.,.
possible length at the lowest possible direct cost, in casf 2, the contractor sustains
an indirect overhead cost of Rs 2000/-per week and a 1~enaltycost of Rs 5CKK)/-
. --. .- - --I--J..l
1 -*: -.
per week beyond 25 weeks. What is the least costly cornmerlun scrleuue the
contractor should attempt?
Quantitative Management
Applications
INTRODUCTION
Nowadays, pr~ oject operations iwe comljlex and may rur1 for a number of
years. The inte.rrelationship amc,ng the acztivities En d the cc st impli~ cations of
-..*.,.- ,,,,, r r
YsVJCLLJ u l a y llot be always a p p l ~ v~~ ~a .l ~ ~ ~ and
d ~ iC u- v
\.---*:L^L --l --
n er t d ~dnalysis of
operations may in many cases prove to be beneficial.
Operation research (OR) provides decision ma1ters with quantita tive basis
. -. . . .- ,. .
for decision making. The advent of low-priced microcompurers having
adequate capacity has eased the use of OR even by smaller firms.
The techniques of network analyses like PERT and CPM are widely known
to the civil engineers. Other OR techniques like linear programming, trans-
portation models, queuing theory and Monte Carlo simulations can also be
very useful in the analysis of projects. A few of the techniques are discussed
in this chapter. The descriptions are purposefully brief and the readers are
encouraged to read other OR texts to obtain a complete idea about the several
OR topics. It is assumed that project engineers use the readymade computer
softwares to apply the techniques. Therefore, a basic understanding of the
techniques is generally sufficient to the practising project engineer
LINEAR PROGRAMMING
Linear programming is a mathematical technique for finding the optional
uses of an organization's resources. The word linear refers to the assumption
that the variables are linearly related. The ch aracterisltics of tlhe linear
programming are presented here:
Quantitative Management Applications 189
1. There must be an objective represented by a linear eq uation tl\at the

firm intends to maximise or minimise.
2. There must be an alternative course of action represented by linear
equations that the firm may decide to take.
3. The resources are limited. In other words, alternative course of actions
that the firm may choose must remain within a maximum or minimum
or both the limits.
r . .*
Linear programming mathematically speaking, rerers to tne maximisation
or minimisation of a linear equation subject to a number of constraints
represented by linear equations and/or inequalities.
.. .
To illustrate the method, a simple example involving two variables is
presented. The graphical solution is presented in the first instance to explain
the problem. Algorithms such as simplex methods are developed to solve
the linear programming problems. For almost all practical cases, commercial
softwares based upon algorithms like sim plex met.hods are used to
linear programming.
Example 9.1 A structural fabricator can manufacture either roof trusses or '
colurnns/beams. The options and the profit margin for the fabricator is
presented in Table 9.1.
Table 91.1 Options and the profit m,argin
luula required fcJl 1 LLj11
of product Total hoiurs

available
Trusses Columns/beams
Asseml
Weldin
-
Profit 1)er ton
The 01)jective fiunction c
hAq";..
lvLaAu;lisethe EY u -+;
.n*. --
arlvi L,
.. . where P =profit
T = No. of trusses, and
% = No. of columns
The constraints that can be derived from Table 9.1 are as iollows:
issembly 2C560
Velding 4C548
.imits -p 20
C20
The constraints in equation (9.2) through (9.5) are plotted in a graph

presented in Fig. 9.1.
Truss
Fig. 9.1 Plot of available options
The equations (9.2) and (9.3) are represented by lines BC and EF respec-
tively. As the lines BC and EF lie in the positive quadrant the equations (9.4)
and (9.5) are satisfied. The area of feasible solution, i.e., the area that lies
among the equations (9.2) through (9.5) is bounded by AEDC and is shown
hatched in Fig. 9.1.
The objective is to maximise the profit line, i.e., Eq. (9.1). The first and
second example of the profit line is shown in Fig. 9.1 having profits of
Rs 4,800 and Rs 9,600 respectively. The other profit lines must be parallel to
the first and second example profit lines. The maximum feasible profit line
must pass through the point D in this case and is shown in Fig. 9.1. The
coordinate of ,D indicates that 12 tons of trusses and 6 tons of columns should
be produced by the fabricator for maximum profit which is about Rs 13,200
as derived from the profit line passing through the point D. The graphical
approach of linear programming is very simple, however is not really
suitable for practical problems.
Simplex Method
Simplex method is an algorithm to solve linear programming. The computa-
tional routine is an iterative process. Each iteration moves closer, forwards
the optimality and the method finally arrives at the optimal solution. The
simplex routine for the previous problem is presented again in the following
example:
. As the first step, Table 9.2 is prepared. This shows a simplex table that
describes the equations in a tabular form.
Quantitative Management,
Table 9.2 Simplex table
Cj Quantity
Rs 800 .,, L
mix T C
Replaced row 0 sA 60 4 ,I, 2
0 Sw 48 2 , 4 0
z~ Rs 0 0 ' 0 0
Cj - Zj Rs 800 Rs 600 0
Optimum
column
In Table 9.2, first row describes Eq. 9.2 and second row aescri~esEq. 9.3
-
respectively. The inequalities of the Eqs. 9.2 and 9.3 are made equal by
introducing two variables called the slack variables namely SAfor assembly
and Sw for welding. Two additional rows namely ZJdescribing total profit
and Ci - ZI describing the net profit is added in Tab& 9.2. A positive number
in net profit, i.e., Ci - Z, row (Rs 800 in case of a truss) indicates that profit
would be increased by Rs 800 for each unit of T added. The column which
has the largest positive number in Ci - Zi row is callc~doptim nn and
is replaced as follows:
The following ratios are determined:
Quantity in each row
No. in optimum column in the same row
The ratios for this example are as follows:
SArow : 60/4, i.e., 15 : 1
Sw row : 48/2, i.e., 24 : 1
Since SAhas smaller positive ratio the row is called replacing row and the
number in the intersection of optimum column and replacing row is called
intersectional element (in this case ; 4).
The second simplex table is now generated as follows:
The numbers in trusses (f) row of the new table is computed by dl
each number in the replaced row (the SArow) by intersectic
as shown below:
The remaining values in the table are computed as follows:

New - Elements in
(row)-( old row )-(Intersectional element
of old row In repliacing rov
Calculations for change of numbers in Sw row is represenlted be101
48 - (2 x 15) =18
2- (2x 1)= 0
--
192 Construction ~ a n a ~ e m eand

n t Planning
The second simplex table is developed in Table 9.3.

Table 9.3 The second simplex table
Prod-uct
Quantity -
mi:Y 1
The total profit (Zi) is estimated by

Zj (Total)= Rs 800
Similarly, Zj for 7' is estimated by
s 800(1) -
The total valu~ row are !similarly estimate!d. The v
.--. -1. '. '1.. c-1-1
row can now be esrlrnared and is snown m me rame.
In the second simplex table, the column/beam (C:I column is the op timum
column and the previous procedure can be repea.ted to obtain thr2 third
simplex table and is presented in Table 9.4.
Table 9.4 Final simlplex table
~ n n
-
RS 800 D..
n a ovv
ci mix Quantity - SA
-1 -1
In the third simplex table (Table 9.4), there is no nc)n-negative Cj- Zj value
which indicates that the solution has bee!n reachc!d. From Table 9.4, the
I;. err
..-A
fabricator should produce 12 tons of truss LlllCl S behlll,Inrrl...
L U ~of C n
Culul,11115 L U
.m - n o
maximise the profit to Rs 13,200. The graphical solution has also derhred the
same values.
In actual problems, the hundreds of constraint equations and itelaLlurLo
may be involved. Commercial softwares are general1y used tc) solve practical
linear programming problems.
Transportation'Problem
Some types of linear programming; problenIS can be solved tvith the 1
A*-"-
more efficient computational proceuulr UlaL Lll
-:-.,I,.,
LL-.
c ~lllylm
-
lltcihod. BeftJLcU l c
,a4 LL,.
advent of computers, a computational burden was an important factor for

Quantitative Manaqement Application
any practical technique. Transportation problems c ment problems

h<~ve been found to be easier to solve by t r a n s p o L~ L~L ~by
~ ~simplex
~ ~ ~ ~
algorithm. An example of a transportation problem is provided below:
The transportation method was formulated as a special procedure for
finding the minimum cost programme for distributing goods from several
sources to a number of destinations. Assuming each source has a given
capacity and each destination has a given requirement, the objective is to
schedule the shipment in a way that minimises the total transportation cost.
1Example 9.2 A stonechip supplier has received orders to 5 : three

.
-..-:. .
prujeccs -
within a city and stonechips are shipped from three plants in the
Iregion. T he relatirre figure:5 are presented in Fig. 9.2.
A transportatioIn table a s shown in Table 9.5 is pa
r ara
Project
5
102 req
'
. V)
u
41 req
-ig. 9.2 Figurative representation of the problem
TaMe 9.5 Transportation table (Initial\
oject Project i
1 requirements 1 I 1 2 1 5 1
Construction Manaaement arru r r c n r r
In the table, the d ged. The unit transportati

cost for stonechips is J L I V V Y l l u 1 U L c LL511C l l a l l u CVILICl 4, -"-h -.-,I 1.
,n*,,, '
CaLII Ccl
Similar to the simplex proceduce for linear programnning, the first step is
to create an initial solution as a starting point leading to improved solutions.
A systematic procedure known as the north-west, , c, o. ~ ~ t ,.1Lr Ul L ~ has been
developed for setting up the initial solution.
Starting at the upper left hand corner, i.e., the nortl the
table, the supply available at each row ... -..- L 1L A -..L--.
1 1 1 ~ LJCs ~ exl~au>~t.u v r r u ~ t I. L L U V ~ ~
down to the next row having alway!s maintained the nd

project requirements as shown in Tab11 e 9.5.
- -1. 1:1.- -
The initial solution should always loo^ l i ~a e srair srey partern as srluwn
-L-1.. .
.I
in dotted line in Table 9.5. If n be the summation of total number of sites and
plants the number of used cells should be equal to n - 1. In this case, n is 6
and the number of used cell is n - 1, i.e., 5. When a solution does not conform
to this condition, i.e., the stair-step pattern, a condiition reft:rred to as
degeneracy is said to exist. This may occur whc!n a colulnn requirement and
a row requirement occur sirnultaneou~_, :lv.
.
To resolve this degeneracy, a zero is assigned 1to the uniused cell to mainti3in
the unbroken stair step pattern. The zero in the cell ha!j no mea ning to 1h e
problem. It is merely a computational device whicn permts 1 .. to contlnue .
... with ~ - -
the method.
The total ( I initial s s presenibed in Talble 9.6.
.. ..
'able 9.6 Total co1st of initia
rce destin Unit Iota1 cos

combinatic (Rs)
- -
he initia n can bt red by a method a modifi
.1
lounon.' r
(MODI) method.
1 Table 9.5, the rows and c are den0 espective
, is the cost in square ij,
Quantitative Management Applicarions 1
As the cost figures for used cells in Table 9.5 are know11 followi
ships can be drawn:
R1+K1= 4
R2+K1=16
R2+K2=24
R3+K2=16
R3+K3=24
As the equations refer only to relative values as opposed to absoli
numerical values, one may assume (by convention the ul,per left 1land con
cell) R1 = 0 and the other values would be deduced. as K1 =:4, K2=
K3 = 20, R2 = 12 and R3= 4.
Improvement index, i.e., Cil -Xi - Ki for unused cells are novv estimai
as shown below:
Celll3 C13- R1 - K3= -12
Cell23 C23- R2- K3 =-16
Cell31 C31- R3 - K1 = 0
The highest negative value of improvement index at Cellz3in,dicates tl
for every load shipped from plant x to project C, the maximum amount
.
savings can be achieved. In order to maintain the balance of the total p12
*
capacity and project requirement the following adjustments are made.

The initial condition of the relevant part is presented in Table 9.7A.
-
reduce the cost, schedules are changed to maintain the material t
the revised schedules are shown in Table 9.78.
Tsbk 9.7A Initial schedule Table 9.7B Revised schedule
Maximum quantity is now placed in the most economical cell 23, i.e., X
and the improved schedules of transportation are presented in Table 9 5.
Table 9.8 Transportation table (improved)
K1=4 Kz = 12 K3 = 14
,
Project Project 1- ant
B C capacity
R1= 0 CL
XA 16 XB 124 AL 116
Rz = 12 Plant X
yA72y';:
16 -
--
,;
R 3 ~ 4 PlantY
~ ' l b I
Project
requirement
L
The second trial for an improved solution is madle as before. As the cost
4l
215
'igures fc,r the us6!d cells i~I Table 9.8 are knlown, the nships
:an be dr'awn.
R, . T I A
i equal toI zero as before, K : 4 and

I
1
I -.
lmprovement mdlces, i.1 !i- Kj for unused cells are now estimated
as shown below:
CC*-*~
-,L- R1- K-
Celll3 C13- R1 - K3 = +4
Cell31 C3i - R3- KT= 0
Cell33 C33- R3- K3= + 16
The irnprovea second solution is presented in Tat
Quantitative Management Applicat~ons 19;
Tab ransportation table (second i~

T I I
Plant
P--- -:*--
The procedure is repeated to obtain the third imp1 lution a!

presented in Table 9.10.
Table 9.10 Transportation table (optimal sotutlnnl
Plant
Project A Project B
--
Capacity
R1= 0 Plant W
WA 1 4 WB
56
I 4 - 56
""
16 XB 24
R2 =16 Plant X -
R3 = 8 Plant Y
YA
31
1 8 YB 1 YYL
46
. --.
72 102 41
215
One may continue with the procedure given the values shown in the third
table, i.e., Table 9.10. The improvement indices is found to be all non-negative
indicating that the optimal solution has been obti
The total cost for optimal solution can be foun d as:
---- ,
56~4+41~16+41~16+31~8+46~16=Rs252U/-
The value of optimal solution is fou 3 less th;m that s
Table 9.8
QUEUING CONCEPT AND APPLICATIONS
In almost every facility there are examples of w les refer]red to as

queues. In a q~leue, tim e and/or money is waste1d by the idle per:
machines. On t'he other hand, the waiting; time i n ,a queue (
198 Construction h(anagemtent and PIanning
deploying additiolnal service facili[ties that in turn 2s the cc

. .a.
service. The optimal service tacihties are at a point when the summat~onof
cost of time lost for waiting plus the cost of service is minimi
A tower crane in a high rise building is a typical example. 1s like
-.
concrete, mortar, brick and timber are lined up to the (crane. Thle waitin!5 time
for these materials in the queue have an adverse effi?ct on t he~idle labjourer
in the upper floors waiting for the materials. An additional crane on the other
hand increases the capital imd ope1*atingex]3enses of ' the project.
OR researchers have foim d that the arri~ ,a1 characteristics of the c
population to form the que!ue in mc)st instarlces follow the Poisson dis
tion. It is possible when service times are treated to be constant. In most
occasions when service times are randomly Idistributt.d OR researchers;have
found that they are best described by the exponenti.a1 probability distribu-
tion.
Single Channel Queuing Model

. ..
The single channel queuing model IS Dasea upon the followinl5 assumF
1. The number of arrivals per unit time follows the Poisson's distrib
2. Service times are described by an exponential distribut ion.
3. Queue discipline is on first-cc)me-first,
4. The calling population is infbnite.
5. This is a single channel systeim.
6. The mean a1rrival rat1e is less ithan the mean seiwce rate
Under the a b ore~ condil:ions, the! queuinl5 model specifies
elationships:
Iean length of the system
Iean l e n ~ ? queue
r--- &:-.
5
Ws = Time in queixe + time in servic
5
-, ,a a:-.
robability tliat thc2 service facility is busy
where A arrival re~ t per

e u~ e, and S = te, i.e.,
numbers er unit of time.
Sultiple IChannel Queuin~ g Model

n this ca:;e, the conditions except tlle fifth o oned abc)ve is ass
I Quantitative Management Applications . --
I
to be true. The fifth condition is a multiple channel in lieu of d single channel.

Under such a condition, the queuing model specifies the following relation-
ships: 1
where K = No. of channels in the system, Po = The probability that there will
be zero units in the system (Refer Appendix IV), Pw = The probability that
all channels are simultaneously busy. All other notations have the same
meaning as before.
The two models proposed above are the only two basic queuing meA-'- IUCIJ.
Real life situations could be much more complex. Many of the assumptions
like arrival in a Poisson distribution, service time in an exponential distribu-
tion, service under first-come-first-serve basis, infinite length of queues ----
~lay
not be true in practical problems. A number of variations of the above mc~ d e l s
have been proposed for different situations. In a number of cases, the
situation is so complex that there are no quantitative models which can L -1-
rlerv
to analyse them. problems, simulation is a better approac
investigate the pro1
Example 9.3 A large structural workshop operates in three shifts, 24 hours

a day. The tool crib, i.e., the counter to supply tools to individual workers'
requirement is manned by a single attendant who serves 27 workers per hour
and the average service time is 2 minutes for each worker. Assuming the
attendant's hourly wage is Rs. 12/- and the average worker's hourly wage
is Rs 15/-, determine the efficiency of the tool crib and suggest i r n p r o v e ~ ~ n t
if any. I
Solution: I
Average service t h e T =2min =0.033 h

--60
Service rat( - = 3(
2
27
Mean length of the system Ls = ----- = 9 workers
30 - 27
200 Construction Management and Planninp
Total cost per day:

Cost of the workers = 5 A L* A 15= Rs 328
Cost of the attendant - = Rs 21
Rs 35:
If a two channel system in introduced,
A/slK A
Mean length of the system Ls = PO+?
(KS - A)
where K=2, A = 2 7 p e r h a n d S = 3 0 p i
From Appendix IV
A
for - = 0.45, Po = 0.379, Ls = 1.13
Ks
Total cost per day:
Cost ol' the workers = 1.13 x 24 :
Cost of the attendant = 2 x 24 x 1, - 576.00
;L
= Rs 982.80
It can now be suggested that a two-channel system in lieu 01 I a single
el reduces the cost by about Rs 254
Simulation is a quantita tive procedure which describes a PIrocess by develop-

ing a model of that process and then conducting a series of organ ized trial
,-.3
and error experiments to predict the behaviour or tne process over time.
Many real life OR problems are complex enough to describe and ithereaftelr
solve by mathematical models whereas in simulation the mat1~ematica 1
.. . . . . . . .
models are built which cannot be solved and are run on trial aata to simulate
the behaviour of the system. A mathematical system of equations may no t
be solved for a number of reasons. Unavailability of input data, thc2 numbeir
of unknown in the equations, the ambiguity about the exact nature of
relationships a1mong thc:variablt3s, the complex n: tture of Ehe systenn, etc. art?
only a few of tl-Le reasons that mely hinder a solutic,n to a sy,stem of equations
.. .A,. +l. . . ; methocI
available to the decision maker to observe the system.
Simulation does not derive absolute answer like the other OR models say
linear programming. Some experts insist that simulation should be used only
as the last available method. Simulatior1s are encouraged when the actual
observation of the system is eith:er practically impossible or very expensive.
Simulation is not precise. It only- g-i -v-e-s- m
- - idea about the uncertainty or risk
of the possible outcomes. The decisionI maker still has to take his owr
decision for the course of action. Sirnulaticsn only helps to ta,kesuch (lecisions
Quantitative Management Applicamons zu
Simulation is essentially a computer-oriented I nse quan

T
tity of calculations are involved that cannot be practically aone manually. 11.
most simulations, data are synthetically generated from the expected dis-
tribution of probabilities and is called Monte Carlo's Method or Monte Carlo
simulation. The steps of simulation are as follow=.
1. Definitic)D of the given pr.oblem.
2. Formula.tion of tl.le mathelmatical s.ystem wl esents thc problen
I LA-4-.. ,l"t,-.A
that will v c 3 U 1 1 LLlaLcu.
3. Identification an(1 collection of in^)uts like the probiability distributioi
of the ir put variables.
4. Runnine- LL -:-..l-L:^^ -,
int.-I-?,."
LAIC ~ U I L U I C I L I U Iv~hich
L
4 . h . L.llnT.,;
n
v l v c a nLc lvllv vv
*lT.
lwing vallues of thle input \rariables on a ran(lom basis depend

upon thle probability distiribution Iof input variables
(b) Obtaining an answer by usine the sel lues to tl
matical formulation.
' 1-
(c) Repeating the process to generate a numDer or sample answers.
:aining the statistics, i.e., thle mean an d the PI r distribu
1 of the answers.
,
- ..
(el ~tis assumed that the answer tor tne real world problem woulc
1
alsc) have the same statistics, i.e., mee~n and standard c

of the sample answers.
5. L V L ~ K-U aI ~decision with the knowleure
1 2-1.:- l-J-- -< LL--L-L:,.
ul U L b~a~latics
1
~ of thc ~ U ~ L U I
outcomes.
A simple example Iof a simulation i s presented in tlle followring. In
.-.-, .... - -- ...- --. -- - - - - -
housing complex under consrruction, a ryre-mounreu
L L - 2
c r a w 1s used to lii
-
materials to the upper floors. Various worker group s accurnulate th

materials at ground and then summon the crane which takes mc)re or les
(lr LL-
1
nalr a day to set up, lift materials and unloading these in. me upper floors
The n~anagementhas kept a record and derived the probiability distributioi
of cal:ling the crane as shown in Table 9.11.
'able 9.11 Probability distrit

-
Cumula tive
Probability
- . ,....
No call a
jingle call a day 32
Two 'calls a day 26
Three call-3 a - -'--.
uay 18
Four calls a day
The management is interested to learn about the utilisation factor of the

crane.
A simple simulation can be set up to study the problem. The expected
number of daily calls for the crane:
As the crane can clear two calls a day, one crane would be sufficient but
a queue would form. The cumulative probability distributions are shown in
Table 9.11. A series of random number normally distributed between 0 to 1
is generated in a computer (a random number table can be used as an
alternative) and is presented in Table 9.12. When a random number exceeds
a particular cumulative probability distribution, the corresponding number
of calls are shown in this table. The outcomes of the experiments are
progressively shown in the table. In Table 9.12, the crane is never idle whereas
a back log of calls is accumulating at the end of the day. If a second crane is
added the situation is again simulated in Table 9.13. In this case, there are no '
back logs but the idle time of crane has reached 19 half days, i.e., about 47.5%
of the total crane time.
If the process is repeated many more times and statistically calculated, one
would have an idea about scenarios involving one crane or two cranes. The
decision maker may compare the relative cost figures for crane idle time and
call back log to decide the feasibility of employing the second crane.
Table 9.12 Steps for example of simulation (one crane)
Random No. of No. in No. in No. Number Crane

Step
number calls queue system served remaining idle
1 0.41 2 0 2 2 0 0
2 0.63 3 0 3 2 1 0
3 0.92 4 1 5 2 3 0
I Quantitative Managerrrarrc nrplicafions
Table 9.13 Steps for example of simulation (two cranes)

""*
Random No. of No. in No. in Number Number Crane idle

Step number calls q u ele
~ syste,rn served remaining
1 0.41 2 0 2 0 2 (half day)
2 0.63 3 0 3 3 0 1
3 0.92 4 0 4 4 0 0
4 0.57 3 0 3 3 0 1
5 0.78 3 0 3 ' 3 0 1
6 0.46 2 0 2 2 0 2
7 0.25 1 0 1 1 0 3
8 0.36 1 0 1 1 0 3
9 0.13 0 0 0 0 0 4
BIDDWG MODELS
Competitive bidding is a common phenomenon in the construction maustry.
Most construction jobs either in the public or private sector are awarded
through closed competitive bidding. In closed bidding, the bids are sub-
mitted in sealed envelopes and all bids are opened simultaneously. Usually
the lowest (or highest depending upon the nature of the situation) is
accepted. Generally the contractors are technically cleared at earlier levels
that tends to eliminate the production cost differences due to the size of
operations. Therefore the cost of production can be assumed to be virtually
same for all competitors. The difference in bids is solely due to the difference
in the profit margins or the mark-up kept by competing firms. If the mar'k-Up
e rcontracts with iow profits. If the mark-up
is low, the firm wins a n ~ ~ m bof
is high, the firm may not get many contracts b ~the t higher profit margin of
the jobs that has been won would lead to better profitability. A firm must
strive to strike an optimum mark-up that would balance between more
contracts with low profit versus less jobs with higher profits. Probability
theories can be utilized to chart a guidelhe for such problems
- kexample
~ model proposed by Ackoff and Sasiene is presc
The first step in submitting a sealed bid is to estimate tne co:
performing the service. Normally the bid is submitted with a m bove
the cost. If the offer is accepted the mark-up is the p rofit. In ( !sled
bidding, the winning price is often the only one th at is ma ic. A
contractor may keep the record of the tenders where he has t~tken part
determine the following:
where P = Bid price offered, and C = Estimated cost (

The probability that one has the lowest bid is the probability that P/C is
less than a random variable that is normally distributed about p with
standard deviation o.The probability is
The expected profit is given as
P=(p-c)f[$)
In order to maximise P with respect to p the first derivative is elquated tc
zero
P
Assuming y = Z,
L
f(Z)+(Z-l)f'(Z)=O
andif Z = p + f o ,
and
Thus t satisfies
t
, The above relabonshlp can be solved krom me standard normal tables

available in the statistical handbooks.
The relationship is plotted in a graph in Fig. 5).3. The ()ptirnum 3
can be estimated from the graph. However, a number of simplified assump-
tions are implicit in the approach. For example, it is assumed that competitors
would not be influenced by each other. In real life cases, the presence of
--
competing ten~ derers m ~lterthe behaviour of a contractor.
I GAME THEOFIY
A game is a sit1lation in which m.ore than one deci!sion maker chooses courses
of acthn and uI which the outcome is the result of the comlsination of choices
taken by partic,-..,.
The games where some players gain more than others at the CIonclusiolI
are called competitive games. A game with two players where a gain of
player equals the loss to the other is known as a two-person zero-sum game.
In the game w-here a gzkin of onc may or may no1: be equa1 to the 1'OSS of thce
other is called non-zerc)-sum ga me.
Quantitative Management Applicatiorc m*
t ---+
Fig. 9.3 Optimum mark-up in a bidding model
The game theory although very promising in prc2dicting ;the comF)etitive

behaviours of the parties has been used so far in a limited way. I %
main
..7--7
IIL ~
.
difficultices are to jfind values to reduce the practical situation ito a mathemati-
cal mode11. In mosit practical cases, the rules of a gam.elthe en1d state, i.e., win
L- -.
,.---c--
or loss S~LU~LLUII, -" '1.5.-' profit or loss canrlui
and pay UIIl --L
Ileu '-
ve easilv defi--" LU-I
mathematical figures. Eve]n with thle limitations at th t time tht? game

theory has been successf ully Use(d in certain case utlines 2ind an
r-11
example are presented in me rollowing.
4 1
In a two-person zero-stIm game if a player A has m coursc sn and

player B has n courses o f 4 action th,en a pay-off matr & can be cted as
follows:
Actions available to A are shown in rows and a(2tions av ailable tc> B are
shown in columns as presented in Table 9.14. A's I2ay off nnatrix has been
constructed, and so has B's -pay-off
-
. ..
.. "
matrix, which would be negatlve (D
it is a zero-sum game).
Table '1
D.id ., Lfidmple
Evc of a game th
Play
ail
rct~onManagement and ~ a nling
r
There are various method: ; of solving such two pers sum gaIYles.
However, linear programmmg tnat. can De usea as a genera method of
.3
solution is shown in the exan~ple.

Example 9.4 Two 1arge stec21 distrik ublic sec:tor
department for the supply of steel are trymg
. .
- - to mcrease their sales at the
ense of the other. The -pa!?-off mat:rix from the incn %
Per'2entage c)f sales share fro1n the vit of supplj l in
Table 9.15.
Tabl
cease Increase Provicle free

rice credit tim~
I e deliveries
Y1 Y2 Y3
- -. --.
'rice a
1 Increase credit
time
'rovide frc
a
eliveries
Let the value of the game to A be V. Now, B would try to minirnise V. Let
andIYl, Y2. Y: be the probabilities by which A and B 1respectively
X11 X21. X3
select their strategies
gamst A:
Pis B's objective is to mm11nise V, 1-le should maximj .erefore, the

line,ar programming fonnulation can 1:)e stated as follow
daximise
--A LA
Quantitative Management Applications 2
The solution of the linear programming derives:
Similarly, the strategy for A would be
One should note that these are the probabilities depending on wnlcn t.,
suppliers select the strategies. However, it does not predict strategy that the
supplier should adopt. It should still be decided from subjective considera-
tions.
EXERCISES
9.1 What are the characteristics of a problem that can be solved by linc
programming?
9.2 What is a simulation? Enumerate the steps -I= uL
- ~"~"nte
1.4- Carlo simulati
process.
9.3 Describe a model to estimate the optimum ma 3 competitive biddi
process.
1 3 ,
9.4 A site requires a minimum of 10,000 cu.m of gravel and woulaer mixture. T
mixture must contain no less than 500 cu.m 01 ' gravel a1~d no more than 60
cu.m of boulder. MateriaIs may be obtained from two pits.
-
Delivery cost Percent Percent
Pit
(Rs/cu.m) gravel bouldler
p- -- - --
Formulate and solve the problem by graphical means.

(Ans Pit 1 : 3300 cu.m, Pit 2 : 6700 cu.m).
9.5 Use linear programming algorithm to solve the following probler
Maximise P = 4x1 + 3x2
Subject to 2x1+ x2 I10 3x1 + 3x2 5 16
(Ans XI = 0, x2 = 8).
9.6 A fabricator makes roof trusses, transmission towers, wtagon and boilers. T
work is carried out in the three major departmentsi namely fabricatic
assembly and painting. The relevant data are presented .In tne . .>
., rollowlng:
,- ,
208 Cor 1 3 t 1u~~rurr
Management and /-~arrnrnu
Table l Tinne require!d in hours per unit of produc

n ours
Departments Trusses Tovvers Wag;ens Boil ers av;~ilable
Pelr week
Fabrication 4 2 3 3 800
Assembly 10 6 8 7 1200
Painting 10 8 8 8 800
1peration F)er unit of product

Table II Cost of 0
-
D ns Boiler
-
Fabrication
Assembly
-
-
-
Table III SellingI price pel unit of plroduct
Trusses : Towers : 95
Wagons : Boilers : 130
Formulate linear vroerammine rormulae to maximise week1

1 . 2
(A11s Maxinnise Z = 9!
Sul~jectto
K2 + 8x3 + 7x4 I 120C
~2 + 8x3 + 8x4 < 800
Xl, x2, x3, x4 2 0)
9.7 The transportation corsts per unit between 3 brick fields and 4 project !sites are
mentioned in the follc)wing. Thte brick field outputs and project requiirements
afe also indicated. Edrimate the minimum cost of transportation to n~ e e thc
b t
requirement:
-eject sites
Brick fit - L Brick he.,
Rs) , (R outpul
10 1 10
--te requlre
(Ans Rs 278/-)
9.8 A repair shop is attenc iingle mec o receives on the av
workmen an hour andI takes on average 6 minutes to adjust the small defects. ',
Estimate (a) the average numbt~rof customers in the systemI, (b) the iaverage
Quantitative Ma t Applications 209
number of customers waiting to be served, (c) average ti1 excluding

service.
(Ans (a) 0.67, (b) 0.267, (c) 4 minutes)
9.9 A construction firm is planning to purchase a special instrument. T he instru-
ment on the average can perform 25 operations per month. The fir1rn expects
about 80 such operations per month in the next few montl
I
(a) How many instruments should the firm purchase?

(b) What is the average number of operations in such a g
(Ans (a) At least 4 instruments, (b) 5.58 operations)
REFERENCE
1. Ackof and Sasiene. Fundamentals of Operntion Research. Wiley EasterrI Limited,
1968.
I CHAPTER 10 1
Qualify Management
and C-#etv
INTRODUCTION
Quality control, which is a crucial part of project rnanagement, is generally

given less importance when compared to other aspects of construction.
Through quality control, the probability of finding a substandard pnoduct is
estimated, thereby providing an index on the quality of the product
For the effective management of a quality control programme, a realistic
and workable quality control design is required. To attain the quality criteria
during the construction process, the specification of quality requirements in
the design and contract documentation becomes extremely important.
After evaluating the owner's need the designer has to plan a facility that
meets the requirements giving due consideration to time and cost constraints.
The owner's needs are expressed in the form of specific criteria that guide
the engineering and design process.
Once the quality of design is established, it is the construction manager's
responsibility to adhere to the standards fixed by the designer. The project
manager is required to evaluate the trade-offs between the quality of
conformance and the cost of achieving the standards.
The quality of conformance is also influenced 'by number of factors
namely, (i) methods of field construction, (ii) equipment capabilities, (iii)
skills of the workmen, (iv) supervision standards, (v) quality of raw
materials, and (v) quality control plan. Quality control is the responsibility
of the designer during the design phase and that of the construction manager
during., the construction phase. Thus the qualitv of design and the quality of
confomlance anz complt to eaclI other, and the combined plan
Quality hanagemenr ana sarery ;ni
determines the quality of the constructed facility; In this chapter, the effori
I
is to concentrate on the quality control plans.

A number of organisation charts can be made for ensuring quality and
safety at construction sites. In the case of small sites, the project engineel
undertakes this responsibility. In most cases, independent groups arc
primarily responsible for quality and safety aspects.
Personnel from different organisations are involved in ensurin
and safety standards. Each party directly concerned with the project haveA .
their own quality and safety inspectors. They may inclucie repres
from the owners, the architects, the prime contractors, tl.1e subcol
other contracting firms and various government agencies.
In developed countries, the main responsibility to adhere to quality
conformance is generally assumed by the contract manager. In India, the
architect's and owner's representatives normally supervise matters related
to quality control. Occasional visits by tbe inspectors fr.om the statutory
;
agencies such as the municipality, the labour department and the environ-
mental agencies are common.
For large projects, the contractor may maintain an inhouse department to
ensure quality control. Such a department normally reports directly to the
project manager or other senior management staff so that immediate correc-
tive action could be taken if necessary. In addition to the on site inspections,
samples of materials are commonly tested by specialised laboratories like the
National Test House for compliance. Sometimes specialised firms like the
x-ray weld tester, the remotely operated pipeline tester and the nondestruc-
tive concrete tester are contracted to ensure proper quality control.
It is also important to monitor quality control parameters. The collection
of accurate and useful information is important for maintaining quality
standards. Preservation of documents like change orders, 'as built' drawings
and accounting records are important for maintenance, modifications of
plans and disputes that may arise.
QUALITY CONTROL BY STATISTICAL METHOLa
In an ideal situation both raw materials and finished goods requirce inspec-
tion and approval. Exhaustive or 100% testing of all materials can L- ut: LL:--U I I ~ :
consuming and exceedingly expensive. Moreover, many major items like
concrete testing require the destruction of a material sample, and hence
exhaustive testing may not even be feasible. Thus, a small sample is
exhaustively tested and inference on the production can be drawn using
statistical methods. These are called statistical sampling techniques and have
been developed particularly for the manufacturing industries. In recent
years, statistical sampling is increasingly used in the construction :industry.
For example, IS Code for concrete (IS: 456-1978) has specified the use of
statistical sampling techniques (Art. 15) to assess concrete strength.
To interpret results from the testing of small samples one would require
sound statistical methods. Over the years, such methods have been
developed and tuned to the manufact-uring process. A discussion about
statistical sampling plan is presented in this section.
Statistical quality control is based on the degree of variability in the
different characteristics of a product. The same production method or
samples from the same batch of production may have differences, however
minute, in their characteristics. The variations in concrete cube strength is a
good example. Even under laboratory conditions, cubes from the same batch
would have different compressive strengths.
The primary causes of such variations are two-fold: specific or identifiable
and random or chance. In statistical quality control, one is more interested
in the random variations. Random variations in practice, have very little to
do with any latent production defect. It is extremely difficult to assign a
specific cause for a random variation. The purpose of statistical quality
control is to set limits on the property of a product that can be accepted as
chance variations, and such limits are estimated from the testing of samples.
If the property of a product exceeds that limit the process is said to be out
of control and an investigation is required to find out the specific reasons.
As long as the results from sample testing by statistical methods lie within
the prescribed limits one may assume that the variations if any are within
the tolerance limits. If the sample results exceed the limit, the process is out
of control and an investigation is initiated to discover the reasons. Even if
the segregation of assignable and chance causes is not fully achieved, the
method of quality control ensures that the variations are not seriouknough
to affect the product specifications or goodwill associated with the product.
There are two broad ways of controlling the quality of a product statisti-
cally: sampling by variables and sampling by attributes. A number of
standard statistical tables have beeen developed to facilitate the planning of
sampling procedures. Figure 10.1 shows the use of various techniques for
statistical quality control.
Techniques
I
I I
Process control by Product control by
control chart acceptance plan
&
Variables Attributes Variables Attributes
A A
X-chart R-chart Cchart P-chart
Fig. 10.1 Techniques for statistical .quality control
Quality Management and Safety 213
SAMPLING PLAN
Sometimes the quality characteristics of a product has a quantified or

measurable value, e.g., the compressive strength of concrete or the tensile
strength of the steel reinforcement. Such variables have continuous values
and the frequency distribution would follow a Gaussian distribution. Control
charts like the E-chart and R-chart are applicable here. The characteristic
representing the quality of certain products cannot be quantitatively
measured. These products are either acceptable or not acceptable. For
'example, the quality of a terrazo floor or french polish in a timber door is
judged qualitatively by a trained professional. Statistically, the characteristics
are discrete in nature and a Poisson distribution is applicable, Charts like the
C, P and np are applicable.
-. whichever sampling plan is used, the assumption that the samples tend
to represent the entire population remains unchanged. Samples are chosen
at random so that each member of the population has an equal chance of
being chosen. Convenient sampling plans like weighing every 15th dump
truck or picking the top piece of marble from each of the delivery trucks are
suitable only if the population is randomly mixed. Otherwise, care is taken
to choose the samples at random.
CONTROL CHARTS
The statistical control charts can be used for a number of purposes. A few
examples are described here:
1. A control chart describes the performance of a process system. It
indicates when the process should be left alone or when corrective
actions need to be initiated.
2. A control chart is used to detect the shifts in the average process from
the desired level. Control charts are used to make future predictions
of the performance of a system.
3. Since a sample is actually tested, the control chart saves cost.
4. ?'he concept of control charts can be extended to budgets and
estimates. Estimated figures and actual values can be compared.
A short description of a few control charts are presented here:
%chart
2-chart is suitable to control continuous variables. The chart is constructed
from samples called subgroups which are frequently drawn during a
production process. Each subgroup may consist of 4 or 5 samples and around
25 subgroups are tested to prepare the %-chart.
21k Construction Management and Planning
If % is the mean of each sample subgroup,
where X = values of each item, n = sample size of each subgroup, and

- -
x= X
No. of subgroups
The control limits are assumed as three standard deviations apart from
the mean. If S be the standard deviation based on the large sample, the
unbiased estimate of the standard deviation Sji:
where n = number of samples

The control limits (CL) are:
Upper CL
Lower CL
A chart can now be drawn showing the mean, UCL and LCL. As long as the
variables are within the UCL and the LCL one may assume that the
production process is working satisfactorily.
Example 10.1 In the production of certain pakts, the production is said to

be under control if the diameters have a mean of 2.5 crn and a standard
deviation of 0.002 cm. Estimate the upper and loher control limits for %-chart
for means of random samples of size 4.
Solution
LCL = 2.5 -
0'001
d G i = 2.498 cm /
I
In order to facilitate calculations, a control ch&t of constants as shown in
Appendix V has been developed. The limits ard:
U C L = R + A ~and
R LCL=~-A~R
1
where R is the mean of ranges of the samples
R-chart
Range is often used in statistical quality con 01 to study the pattern of
variation in quality. The procedure of constructing the R-chart is as follows:
Quality Management and Safety 215
1. Estimate the range R of each sample group.

2. Estimate the mean of sample ranges R.
3. Estimate the UCL and LCL as follows:
where OR is the standard deviation of the ranges.

The estimate can be quickly made from Appendix V and the limits are
shown as here:
UCL = D ~ RLCL = D ~ R
where D3 and D4 can be found from table in Appendix V.
Example 10.2 The sample ranges of a statistical sampling is presented

below. Estimate the upper and lower control limits. If the range of the 8th
sample is 51.12, can the process said to be out of control? Assume that a
sample of 5 is taken each time to find the range.
Solution
Sample No. Ranges
1 23
2 27
3 24
4 21
5 '25
6 26
7 29
For n = 5,
UCL = D4 x 25 = 2.115 x 25 = 52.875
As the 8th sample is 51.12, i.e., less than 52.875, the proc'ess is within cunrrul.
Cchart
The C-chart is used to control the number of defects per unit. For example,
the number of water seeping spots in each roof and the number of defective
locks in each building may be controlled with a C-chart. The pattern of
variation for the number of defects is assumed to be represented best by the
Poisson distribution. If the number of defects is not small (say above five),
the distribution can be approximated by a normal distribution which
216 uhrrvri Management and Planning
C~rra~r
facilitates the construction of a C-chart. The construction of a control chart

for a number of defects where the sample size is constant is as follows:
1. The defects in a fixed sample size is counted.
2. The average number of defects E is estimated as:
- Number of defects in all samples
C=
Total number of samples
3. The control limits are as follows:
UCL=C+~~?-
LCL =c-3*
The lower control limit if negative is assur
Example 10.3 In a cast-in-situ terrazo work with white marble chips, u ~ t .

appearance of non-white coloured marble chips is considered as defect. In a
quality control check of 15 pariels of terrazo floors of dimensions 2m x 2m
the following numbers of non-white coloured marble chips were found.
7,12,3,20,21,5,4,3,10,8,0,9,6,7,20
State whether the terrazo work is within the quality control limits.
Solution
Only 3 out of 15 samples are above the limit. Therefore, the terrazo work
seems to be acceptable.
In most quality control cases, the sample is either acceptable or unacceptable.

The p-chart is used in such pass-fail situations. The objective of this chart is
to evaluate the quality of the items, i.e., the average fraction defective and to
note the changes in quality over a period of time. The steps for construction
chart are described here:
. .
;timate the fraction defective for each sample group by:
"'
I\]UInber of defectives in the sample
p=- Total numbers in sample
btain ther average, fraction defective from all the samples cornbined
hich is given by:
Quality Management and Saft
-
'Number of defectives in all the s a m p l e s r o m b ~
Total numbers in all the samples combined
3. The control limits are estimated by:
4. The LCL is assumed to be zero if its value is negative.
Example 10.4 The inspection report of a routine welding check is presented

below. Comment on the production process.
Number of
Sample No. of Fraction
units
No. defectives defectives
inspected
1 100 8 0.08
2 100 6 0.06
3 100 10 0.10
4 100 9 0.09
5 100 19 0.19
6 100 11 ' 0.11
7 100 7 n "7
Solution
700 70 -
O.l(J - 0.1)
UCL : 0 . 1 + 3 4 = 0.19
100
LCL : 0.1-3 = 0.01
From the table, it is found that the sample no. 5 is just on the upper control
limit. All other samples are within the control limit. Therefore, the production
process is worlung satisfactorily. However, an investigation may be initiated,
to find out the causes of variation of the sample no. 5.
SAFETY ASPECTS OF CONSTRUCTION WORK

Construction is a relatively high accident prone industry. Basea on tne worm
statistics, the accident rate in the construction industry is about three times
higher than that of the manufacturing sector. It is estimated that one out of
every six persons employed in the construction industry in India has suffered
from injury (1). An abridged list from Malhotra (1) is presented in Table 10.1
to compare accidents in various countrie!
Table 10.1 Employment and accidents in the IQU U L U O ~indust1
Country No. of accidents

Year tal employment
per 1000 workers
France 1983 201642
GDR 1980 NA
FRG 1983 NA 131.4
Hong Kong
Spain
UK
USA
South Korea
India
China
--
The causes of injuries in construction are numerous. The most common

accident on a construction site is the fall of persons from heights. The
statistics for the types of accidents in construction sites in India are not
collected by any agency and are not generally available. An example of such
records of United Kingdom for the year 1976 is presented in Table 10.2 (2).
Table 10.2 Fatal accidents

Causes Percentage
Fall of persons 48.1
Fall of materials 11.7
Transport .1.7
Lifting equipment
Electricitv
Excav,ation and
-
Miscellaneous
There is no safety legislation specially oriented to the cons

industr y in India. How'ever, number of acts may be applicable to the various
1
~ I Z ~ ~ L ~ I of
Z L construction.
~ ~ S Factory acts cover the fabrication ana repair
workshop. Motor vehicle acts are applicable to transport vehicle in slites. The
Contract Labour Act 1971, Workmen's Compensation Act 1923, Ir~terstate
Quality Mal ra3Grr IGI rt and Safety 21 9
lvligranr Workers Act 1979, etc. have provisions to ensure partly the health,
welfare and safety of construction workers.
The Indian construction industry has several special features which affect
the safety and health of the workers as compared to the workers of the
manufacturing industrie!5. A feur of the exampltzs are p resented in the
following:
Temporary duration of work sit1es, high 1abour tu mover, sl.asonal employ-
ment, extensive use of subcontractors, and high competition for jobs.
A construction site is by definition a temporary work site till the facility
is built. The character of the work and associated risk profiles also change
very quickly along with the progress of the work. For example, the shuttering
and reinforcement placing work in a building is inherently riskier than the
finishing works like carpentry and flooring. Temporary nature of works also
causes temporary arrangements for electricity and explosive storage which
are hazardous business. Temporary and open to environment access and
pathways generally induce slippery steps, gangways without railings or
handholds, etc. These factors caused by the temporary nature of the job create
. a high risk environment. In a factory, on the other hand, risk can be
minimised with simple devices like machine guards, handholds and auto-
matic switch-off mechanisms.
A construction site is associated with a high labour turnover. Workers
routinely move from one site to another after the completion of their trade.
In each site, workers face typical risks that have to be encountered. A high
percentaIge of workers who have a rural background go back to the native
.--
villages for agricultural jobs like sowing and harvesting. For medium and
large sites, groups of migrant workers from distant and remote places
perform manual works like earthmoving. The seasonal nature of construc-
tion work also interrupts the worker's daily routines in certain seasons. These
workers tend to forget the safety rules and precautions that they have learnt
previously. In a factory, on the other hand, labourers are more or less
permanently working and hence the safety rules and precautions are per-
manently imprinted in their mind and hence they follow safety precautions
almost instinctively.
Construction firms are generally managed by small family-bound
entrepreneurs. Even for large sites, the prime contractors generally award
components of the contract to other contractors who again subdivide the
work to smaller contractors. The work is thus divided into number of smaller
subcontractors who directly supervise the workmen. Smaller firms cannot
afford the safety precautions because of their low profit margins. It is much
difficult for the regulatory agencies to regulate the small firms. Competitive
tendering with high emphasis for lowest rate creates stiff competition for
cost cutting by any means. Even large firms under pressure from such
competition encourage cost cutting, and this generally affects safety facilities
and supervisions.
SAFETY REQUIREMENTS
There are several sources of legal requirements reg pplicable

to the construction industry. These include:
1, Safety standards by the Bureau of Indian Standards
2. Statutory provisions framed under different labour
3. Contract conditions as agreed with the employer
4. Decisions and awards given by the judiciary.
The IS1 has published a number of codes related to the safety of construc-
tion work sites. A representative list is presented in Table 10.3.
Table 10.3 Construction safety codes published by BIS
Code No.. Title
I1 ,
IS: 3696(I)-1966
IS: 3696(II)-1966
Scaffolds
Ladders
IS: 3764-1966 Excavation work
IS: 4082-1977 Stacking and'storage of construction mater:ials at site (only a
m
recommendation).
1 IS: 4130-1976 Demolition of buildings.

IS: 4912-1978 Floor and wall openings, railing and the bc
IS: 5121-1969 Piling and other deep foundations.
IS: 5916-1970 Constructions involving use of hot bituminous matel
IS: 7205-1974 Erection of structural steel work.
IS: 7969-1975 Handling and storage of building materials.
IS: 8989-1978 Erection of concrete framed structures.
National Building Code (NBC) (3) has discussed a number of safety

I
procedures for construction sites. National Institute of Construction Manage-
ment and Research (NICMAR)has also published a number of manuals that
provide guidelines for specific types of construction sites (4).
NBC have provided general stipulations while the guidelines from NIC-
MAR provide specific details. An example relating to the pile driving pulley
would'illustrate the point. NBC-1983 in Article 13.2.9 of part VII specifies,
I Quality Management and Safety .221
I
"For every hoisting machine and for every chain righook, shakle, swivel and
pulley block used in hoisting or as means of suspension, the safe working
loads shall be ascertained . . ." In the same topic, the NICMAR Guideline No.
3 in page 29 mentions, "The failure of a pulley due to shearing of bolt or pin
is quite common. Therefore, frequent check-ups of the pulley is essential". It
is to be noted that the NICMAR guidelines make an effort to provide practical
advice. A number of statutes have provisions for safety and welfare for
workmen. NBC-1983 in Article 2.1.2.1 of part VII have specifically mentioned
to share responsibilities to conform to statutes like the Workmen's Compen-
sation Act 1923, the Payment of Wages Act 1936 and the Payment of Bonus
Act 1965 etc. In any case the regulations indicated in the laws are applicable
to concerned parties irrespective of its citation in the NBC. Sometimes,
provisions in several acts may touch an incident. For example, the Section .
10B of Workmen's Compensation Act and the Section 88 of the Factories Act
1 both deal with the requirement of a notice to a competent authority after a
1 fatal accident. Such overlapping stipulations are common in other countries
too. For example in the USA, Hendrickson and Au (5) pointed out that the
Occupational Safety and Health Administration (OSHA) has 140 regulations
covering the safety aspects of a ladder. Therefore, the construction manager
should be careful to conform to the relevant provisions of all the statutes.
The contract conditions that have bben executed between the owner and
the contractor define the respective responsibilities and liabilities. This shall
not absolve the owner from any of his ultimate responsibilities under the
statutes. However, in many instances such responsibilities can be passed on
to the contractor by the terms of the contract. As long as the contractor does
not fail to conform to the provisions of the statutes, the owner's obligations
under the statutes remain fulfilled. Certain safety measures are settled purely
in terms of the contract. For example, the code (NBO, 1983, Part VII, Art 2.1.2)
specifies that h e fire safety requirements should be enforced by the owner
even though the facility may otherwise be entirely under the jurisdiction of
the contractor.
Decisions and awards given by the judiciary also define safety respon-
sibilities. In some countries, the tort is an important legal right and a stranger
to a contract may claim damages showing a case of gross negligence on the
part of the builder. A contractor should take legal advice from experts about
a particular situation and study relevant judicial decisions to evaluate the
consequences of not introducing a safety measure. The provisions of specific
safety measures are quite elaborate and are beyond the scope of this chapter.
The readers are encouraged to study the safety codes mentioned in Table
10.3, and NBC Part VII and the NICMAR safety guideline series for the
required safety measures.
.
222 Consrrucrron Management ana r~annm&
SAFETY MANAGEMENT
The safety programme of a construction r i m is an output or tne safety policy

of the company. The safety policy should include the- foliowing:
1. Safe working condition for workmen.
2. Safe operating procedure
3. Compliance with the various statutes and Ilocal rule
4. Adequate training to workmen
5. Timely attention to any notice of thc matters related to
safety
6. In case of an accident, the quick settlement of claims and the
imposition of proper measures to avoid the repeated occulrrence of
such accidents for the same cause.
The long-term objective of the safety policy is t:o increase the pirofit and
goodwill of the firm. In particular, the safety pollcy snoula arram
1. 1 1 1 . me
I..,
following specific objectives:
1. Reduction of accidents causing injury to w
2. Reduction of accidents causing damages to matenals ana equipments
3. Developing solutions to operational or environmental haza:rds asso-
ciated with work
4. Identification and mitigation of ris
5. Imparting training to create safety
A large company would require to establish a safety department to
monitor the safety aspects of the sites. The department should be similar to
the accounts section, should be an independent staff department and should
report directly to the top management about the safety situation at the site.
The functions of the safety department would be listed as follows:
1. To establish the guidelines for the provisions of safety in different sites
depending upon the nature of the job, the 1c ~tion,the contract
conditions and the statutory requirements
2. To prepare manuals, checklists, advice to the site-m-charge, etc. that
will be followed to ensure safety standards
3. To supervise the in-house safety conditions of the site and submit
reports and recommendations to both the site-in-charge anc1 the top
management
4. To conform to statutory obligations and to maintain liaison with me
uality Mar and Safel
statutory agencies and labour unions in relation to th~ ispects

of the job
5. To maintain safety records and statistics for tl-le better Imanagement of
the safety aspects of the job.
A safety officer, who will report directly to the h ~ r l r l rsources
~ director
of the firm, would have to be employed to oversee the activities of the safety
department. For a large work site, a safety committee consisting of
employers, all the prime contractors, labour representatives and statutnrv
agencies would coordinate the safety measures in the site.
ERCISE!5
\at are the! factors tl at affect 1the qualit:y of confo
10.2
- .
Describe in brief the rl;FCoror,
UIIIF.IZllt methods of organizing a quailljr Lu..t,Y.
ProIgramme.
10.3 Wk\at are the! benefits of statistical quality control?
1
... . ..
10.4 Draw a cnart
-1.
and describe the different methods ot 5 r d I l s r l C d l quoury L U I I L ~ U I -
10.5 What is a control chart? Describe its uses.
10.6 "The Indian construction industry requires a comprehensive legislation for the
safety and welfare of its workmen". Comment on the statement.
10.7 Describe the special problems associated with the safety of a construction site.
10.8 List the sources and provide a description of the safety standards to be adopted
for construction.
10.9 What should be the safety policy of a construction firm?
10.10 Describe the objectives of a safety policy.
10.11 What are the functions of a safety department?
10.12 The values of sample mean ji and the range R for 10 samples consisting of 5
items in each sample are given below.
SampleNo.
-
1 2 3 4 5 6 7 8 9 10
X 43 49 37 44 45 37 51 46 43 47
R 5 6 5 7 7 4 8 6 4 6
Draw the mean and range charts and comment on the state of quality control.
(Ans chart: UCL = 47.56, LCL = 40.84
R chart: UCL = 12.26, LCL = 0)
10.13 Based on 15 subgroups each of size 200 taken at intervals of 45 minutes from
a manufacturing process, the average fraction defective was found to be 0.068.
Calculate the values of central line and the control limits for a p-chart.
(Ans 0.068 f 3 x 0.0178)
10.14 The false ceilings were checked and the result for inspection for seven rooms
are presented.
1 Planning
Room No
No. of del
Calculate the control limits for a contlrol chart 1'or defect! !nt on the
production process.
(Ans UCL = 21.23, LCL = 1.16)
IFERENCES
-
1. Malhotra, M.K., "Safety Management in Construction Industy", J. of the Inst. of
Engrs. (India), Civ. Engr. Div. V69, Sept. 1988.
2. Department of Employment, "Reported Accidents in Construction", Health and
Safety Executive, Her Majestry's Stationery Office, London, April 1978.
3. Indian Standards Institlrfion, "National Building Code of India", New Delhi, 1983.
4. National Institute of Construction Management and Research, "Planning for
Safety on Construction Projects", NlCMAR Guidelines, No. 1, Bombay 1990.
5. Hendrickson, C. and T. Au, Projecf Marlage onstrtrction, Art. 13.:2, Prentice
Hall, New Jersey, USA, 1989.
I CHAPTER 11
Resource Management
and In ventory
INTRODUCTION
The progress of a construction project at optimal cost requires a judicious

allocation of available resources like finance, labour, material and equipment.
Finance is the basic resource that is required to procure the other three. The
financial management is treated elsewhere in this book. In this chapter, the
arrangements for labour, material and equipment are discussed. Particularly
for large jobs and remote sites, the supply and availability of these resources
are crucial and must be overcome for the success of the project. Even for
small jobs or urban sites, the optimal cost for procuring the resources are
vitally important for the profitability of the project.
The basic objective of resource management is to supply and support the
field operatGons so that a planned time schedule can be met and cost can be
optimally controlled. The project manager is responsible to identify and
schedule future requirements so that field managers may obtain the resources
at an appropriate time and place to employ these in the project.
The scheduling and allocation of manpower, equipment, materials,
finance and time frames are all intemlated. Resource management is devised
to take the appropriate decision among these interrelating options.
BASIC CONCEPTS
The flow diagram of the resource management is presented in Fig. 11.1. The
planning and network diagram dictates the quantum of the work that is
required to be achieved within the given time period. The quantum of work
in turn necessitates the amount of resources. For example, the network
arru Planning
226 Construction rvrar raut;~~rarr~
diagram of a hou sing pro ject may show that 300 cubic metrc2s of concreting
- . ,+
and 100 cubic meLlc3 , ".-I
C
u r vl,ickwork is required in the lirni I L L U .&~I.L U L-.2LU LU m ~ l e t e
..A\,& - A "A.
the network activities. This would mean that a requisite amount of re5
like materials (cement, sand,stonechips, bricks, etc.), equipment and fz
(mixture machines, vibrators, pumps, electricity, water, storage space, erc.)
have to be mobilised at the site. There could be a number of constraints in
mobilising these resources within the given time period. Limited storage
space, absenteeism among workers during the festive season, inadequate
equipment available in the site are only a few exarnples of the constraints.
In addition, a limited fund may also create a constr,aint for the mobilisation
of the resources. The constraints may impose a celllng... limit of the accumula-
tion of the resources and the project manager may be forcc:d to revise the
network diagram. Even without any constraint, thle projecit managc:r may
jPlanning
-I necessary
I
L
Vorks volu~
per perioc
I
. +
Resource requirements per
period
I
Equiprnen
I requirements / 1 requ:irements 'e~uiremen
I
-IT requi
iysica'
straints I I7 con: aints
Resource collectiorI decision

-- -
1
Resource
indent
Fig. 11.1 Flow diagr urce rnanagement

Resource Manauerrrtsr~larru rrrvarrlury LLI
tune the accumulation of the resources to obtain those at t la1 cost.

:-- ,K ,
,
,
Resource management is associated with such tunby, U L 1rsuurct.s.
LABOUR REQUIREMEkITS
The management of consrmcnon L . . manpower begins with the tabulation of
labour requirements by trade for each project activity. fiormally, an activity
shown in a network can be further divided into a number of sub-activities
to facilitate a labour estimate. The labour requirements to complete each
activity are mainly filled up by estimates made by experienced professionals.
Interviews with foremen, site engineers are helpful guides to estimate the
manpower requirement. References like the All India Standard Schedule of
Rates by National Building Organisation can also be used to estimate the
manpower. An example of a tabulation sheet is presented in Table 11.1.
Table 11.1 . Time and labour requirement fc2r each ac

Mainpower
Sub- Quan- Time
Activity Unit
activity tity (Days) U nskilled skilled
Column Col. base No.
casting Steel work MT
in first Shuttering Sq.m
floor Casting Cu.m
Time gap
Deshuttering Sq.m
Curing lo.
In Table 11.1, the breakdown of the sub-activities are shown in the network.
The time and labour requirements to complete each sub-activity are es-
timated by experienced persons. The time and manpower requirement of the
network is thereafter arithmetically calculated. As il: involve: a large iamount
of computations, computers are normally used to estimate the total Irequire-
ment of manpower for a network. Most comme!rcial softwares hiwe the
features to estimate resource demands. The summary of manpower require-
ments are normally presented in tables similar to Table 11.2. Alternatively,
graphs as presented in Fig. 11.2 and Fig. 11.4 can be prepared.
Manpower requirements of the projec
Weeks
3 4 5
Skilled
Unskilled
Supervisor
--,onstructlon
, Management and Planning
Activitv.
-
M a n Pow
-2 Manpower requirt network
In Fig. 11.2, the manpower requireme]~t of a network is presented. The

activities are shown in parentheses and the associated manpower require-
ments are shown next to the activity. Foi ,-.vnm-1
c,-.allLpie, activity A requires six
workers &om week 1 to week 3. The total number of workers for each week
are presented in the figure. The worker requirements for the network are
s h o w in graph in Fig. 11.4. The requirement fluctuates considerably. It has
g. 11.3 Ma, ,,WVVCI IC,UIIWIICI 11 U I a (Revise

llatw~rk
lading graF
Resource Management and /hventory zzv
implications upon labour cost and morale. The shortage indicatc

requirement for fresh appointment and surplus indicates retrenchrnenr
benefits. Heuristic programmes, i.e., thumb rules, that work have been-
developed to level the resource requirements. In this case, the lr~euristic
approach is to identify the activities that can be delayed as long;
..
- as .QOSSltJle
.
without delaying the completion of entire network. The re1(ised manpower
schedule is estimated in Fig. 11.3 and the manpower requirement i:;almost
constant at 9 workers per week. Such computations are teOlvuJ pactical;..
uL
7
cases an d mosit commercial software packages have resource levelling

feature:;that canIbe utilised to level the manpower requirements. A practical
exam le of manpower scheduling in Indian scenario has been resented bv
P
Joshi.
LABOUR PRODUCTIVITY
Productivity in the construction industry can be broadlj definedI as the
output per labour hour. Labour productivity is a measuire of the overall
effectiveness of a construction work system in utilising labour, equipment
and capital to convert labour efforts into useful output and is not a measure
of capabilities of labour alone. Labour productivity is influenced by many
factors. Some of the factors are typical to a partic1llar worlc site a n c1 can be
termed as site productivity. Other factors which a1re independent of 'job site
can be defined as non-productive activities.
SITE PRODUCTIVITY
Several factors that affect the site productivity are listed below:
1. Work size and complexity
2. Work site accessibility
3. Labour availability
4. Equipment utilisation
5. Contractual agreements
6. Local climate
7. Local cultural characteristics particularly w'ork cultu
NON-PRODUCTIVE ACTIVITIES
Anumber of non-productive activities are inherent in the labour prod.uctivity.

These factors consume labour resources but is not directly assoc:iated to
production. Some of the non-productive factors are listed below:
1. Indirect labour required for supervision and maintenance ofthe work
2. Redoing of the defective and unsaitisfactory work

3. Temporary work shortage for weather or material shortage or equip-
ment failure
4. Union activities during working hours
5. Paid holidays
6. Absentee time like long breaks, late start, early quits, etc.
7. Strikes, go slow, work to rule, etc.
All the above factors among others affect t r product onstruc-
.. .
tion manager is required to estimate the ettect ot such factors wnile esnmat-
ing the labour resources.
EQUIPMENT MANAGEMENT
Similar to labour estimates, a construction manager may estimate the

equipment requirement from the network. A compilation of weekly or
monthly equipment requirement can be converted into a bar chart type of
graph that would help the manager to procure or release the equipment. In
labour-oriented sites, few equipment are required and formal analysis for
equipment and time duration may not be needed. However, equipment
utilisation chart at least for a short-term period is essential to avoid equip-
ment conflict. A typical equipment requirement chart is presented in
Table 11.3.
Table 11.3 Weekly equipment chart

Days
ment -
2 3 4 5 6 7 Total
Backhoe
Dozer
Trucks
An examination of the network diagram gives an idea about the require-
ments of the equipment. The network can be rescheduled to avoid the
equipment conflict. Similar to the heuristic approach presented earlier, in
case of manpower levelling, the equipment demand can be levelled by
delaying the most slack activities without altering the project completion
date.
In case of projects where equipment is a major resource, further analytical
techniques like principles of queuing and simulation can be applied. In case
of firms where a single pool of equipment is used for multiple projects the
equipment demand levelling is done for multiple projects. Some of the
Hesource Management and Inventory 231
commercial sc have the feature 1to handles multiple projects resourc

levelling.
MATt MENT
a- I.*.
nIvlaLcrial
management is concerned with ensurrng mat me quantity an-
quality required, are on the job as per requirement. The construction manager
is concerned about the number df material handling problems like quantity,
auality,
-1----- -
price, delivery date, mode of transportation, inspection, counting,
test, s;torage and protection.
Cc~nsiderabletime and effort is spent on a practical network that will
y time and resource limitations. However, such a schedule is not used
s supported by the timely delivery of materials.
ad times for material delivery are normally inclu~ ded &-t tlhe project
_ _ L
network. However, careful controls and subsequent adjusnnenr over net-
work diagrams are necessary in order to achieve the timely completion of
the network. The establishment of the correct order lead times is very
*PO rtant. Delay in material procurement creates material shortage causing
idle 1iabour and time loss. Early procurelmen t ma:y have a beneficial effect on
cost tscalation which could be easily n~ egated b:y capital blockings, storage
-- .- ..
problems and pilferag;e. A flow diagram of the material procurement is
presented in Fig. 11.5.
In the flow diagra~ n the m aterial indent is based upon planning. The
preceding steps are presented in Fig. 11.1. The raw materials are continuously
processed to the finished goods inventory. Material management is mainly
concerned with the indent, arrival and inventory of the raw materials. The
mate]rial mana~gementiis also in!timately related to material1 usage, a ccounting
m and cc)st contrc)1 system as shown in Fig. 11.5.
.e materii11s for dc:livery toI the site can be broadly classified :is follows:
bulk material:;,standaird items and fabricated it€!ms,
Bulk mater.ials are basic item s like earth, brickS, cemen.t, sand, s tonechipS,
steel, roofing sheet : an(i asphall: that are obtaineci in a selni-proce:ssed statce.
These materials are thc main ingredient!5 of the construction process and are
required in large quantities in cc~nstmcti, on. Sepalmate facilities for storing and
protection of each item is essential in the, site. Wa!stage, damage and pilferage
3.
of tht?seitems are requurea to Dle avoided by special mea:;ures.
. .
St:mdard itcems are c)ff-theshelf items that can be easily procure4i from th~e
:.
mar~et.These. irems are
1- -
mostly-. ..- - .-
m a processed state and requine separalte
space in the same yard or godown. Pipes, pipe fittings, plumbing fixtures,
hardwares, electrical switches and fittings are examples of standard items.
Large numbers of sizes, models, and varieties of items are involved. Separate
space or bins are essential for the storage of these items. As these! items a]"e
easily available, stock at site can be kept low. In some instances, howeve'r,
r---r-I Planning
,
Material
indent 1
arrival
I
- Bill
passing
- To
accounting
system
system
management execution
inventoQ
Balance raw Material use

materials checking
Fig. 11.5 Flow diagram of material management
special models could become very scarce and such items are collected ahead
of time.
Fabricated items are the items that are specially built as per specification
and sizes for the project. These items require long lead times and may
constitute a substantial budget of the project. Structural steel members, roof
truss, doors, windows, electrical panels are examples of such fabricated
items. In case of delay, the construction manager is almost helpless in the
sense that a substitute cannot be obtained immediately. Realistic lead times
for fabricated items are in-built in the network diagram. Adequate control
on timely arrival should be ensured. These items may require sufficient
storage yard and marking tabs to locate them when required. In a labour-
oriented site, the movement of large fabricated items are expensive and
time-consuming. Therefore, stacking is made in order to locate and remove
the required pieces with minimum movement of other items.
INVENTORY CONTROL
In. entory is the stock of goods. For the financial management of the
~n~,t-ntorv,
every decision maker is forced to take the following two decisions:
1,. qr~anturnof the inventory and the point of time to acquire the inventory.
Resource Managemenr and Inventory 233
The inventory involves two basic costs. Firstly, the ordering cost which is
the cost of obtaining an item. Secondly, the carrying cost which is the cost of
maintenance of the inventory. The inventory level of a firm can be approxi-
mated by the relationship presented in Fig. 11.6. The inventory declines with
respect to time due to use in production. When the inventory is finished a
new stock is added that increases the inventory to the previous level. The
average inventory as shown in Fig. 11.6 is one-half of the beginning
inventory.
>
Time ------+
Fig. 11.6 Average inventory level
The inventory cost of a firm is presented in principle in Fig. 11.7. The

ordering cost increases linearly with respect to the number of orders whereas
the carrying cost decreases with the increase-of number of orders because of
smaller inventory size as shown in Fig. 11.7. The total inventory cost can be
plotted by a summation of ordering and carrying cost and is presented in
Total cost to order
No. of orders
per year +
Fig. 11.7 Optimum inventory cost
234 c'onsrruction Management ana rtann~ng
Fig. 11.7. The number of orders where the total cc entory is minimum
is defined as the economic order quantitv.
-J.
The total ordering and carrying cor;t per ye I inventoIry can E)e
represented by
where T = total cost, N = optimum numtJer of ordlers per )i

of h e n t o r y used per year, P = ordering cost per oraer, ana L = carrylng cost
expressed as percentage of average inventory.
Differentiating,
For maxima, the first derivative is set equal to zero
This is a very simple model for an economic order quantity (EOQ). Anumber
of improvements and variations can be made. A few of the applications are
presented below.
EOQ Model without Cost Information

In the previous relationship, it is assumed that the ordering costa cUlu ~ t e
carrying costs are known. Sometimes, particularly for construction sites, such
information may not be available. The concept of EOQ can still be applied
as shown in the following:
YVILCIc - LVCaI U L V C L IAL=~total

LVJL ~ Y ,valhc ~ ~ g e n t o rit
yLU~CC~,
P = ordering cost per order placed, M = optimum value of the order in rupees,
and C =carrying cost expressed as percentage of average inventory.
Differentiating and setting the first derivative to zero for the maxima,
Since x is COI-lstant
over a single inventory, it is co:nstant okler the entire range
of inventory and can be expres!jed as
Resource Management and Inventory 235
iJ
The above relationship can be L~tilisedtc1 determine EOQI as show7n in the
algorithm used in the following example.
The present inventory situation in a site is shown irI Table I11.4. The
ordering cost and the carrying cost are not known. The prob,lemis to optirnise
the inventory cost. An attempt is made in Table 11.5.
Table 11.4 Present inventory situation
!es used No. 0f orders Amount of , Average

Item
year A Per. year rupees per order inventory
1 10000 4 2Fnn LLJU
-
Table '11.5 Reduction of average iinventory
Average No. or
Item .I;i inventory orders per Ordering
(;a)year gap (days)
5 24.50 387.46 193.73 1.55 73.5
- The values c
Rs 2501.15
n Table 11.5 is Rs 316.30. The value or
20.00
L ( N / N I ) III
"a-.
equation 11.7 is me total! number of orders, i.e., 20
a
From equation 11.7,
In Table 11.5, the optimum order value M, i.e., fifrom equation 11.5 is
estimated. The average inventory in Table 11.5 is reduced to Rs 2501.15 from
Rs 3075/- in Table 11.4. The total number of orders in Table 11.5 still remains
as 20. In this case, the average inventory is reduced without increasing the
236 Construction Management and Plannrng
number of orders. In other word!5, the in\ ost is optimised 7without

. . ,-
having the ordering and carrying cost mrormanon.
Similarly, purchasing the work load can be mininised without inc
the average inventory. An example is provided bellow:
From equation (11.5),
As X is constant for a single mventory, it is consranr ror an entire inventory

of items
- .- -
The inventory Gtuation in site as shown in Table 3.1.4 is optimised iin Table'
11.6 by reducing the purchasing work loa.d with01?t increa!sing the average
invent0
Table 11.,6 Reduction of purchasing workload
Modif Average Nc
Initial wentory orde:rs per
orde~
fi orders year (A/Rs
&/order .
Rs/orc TT 4xfi . .
per order)
In the p equation lated by:
The optimised order value can be estimate!d from ec 1.5 and is shown
in Table 11.6. The average inventory, i.e., kialf of thc :d order value is
- - -
presented in Table 11.6 and the total is found to be Rs 3074.43 which remains
the same as the previous value shown in Table 11.-4.The n umber of orders
are reduced to 16.27 per year from 20 numbers shcswn in Table 11.5. In this
case, the ordering cost has reduced without increasi15 .,.I+*. ...
ulc aqerage inventory
cost.
EOQ Model with Resource Limiitation

truction Sites, sel ler problems besi.des the
mentioned previously may crop up. Typical examples are limitations of

storage capacity and/or finance limitations. The limitation results in an
interaction between the different items of an inventory system. In such
occasions, an individual inventory cannot be treated separately. A whole
range of items in the inventory is required to be optimised simultaneously
to obtain the optimum solution under the existing limitations of resources.
The simpler cases in this category can be solved by using the Lagrangian
multiplier, which is described with an example.
Example11.1 Let us consider an inventory system consisting of n items. Let

Cli be the inventory holding cost per unit per unit time and C3i be the set up
cost per production run for the ith quantity and Ri be the uniform rate of
demand per unit time for the ith item.
Total cost of ith item for each batch of production:
where qi is the ordering quantity of'the ith

item and f is the time gap between
successive orders.
Total cost of the ith item for unit time
Now
Substituting,
[i
Total cost per unit time K = C -Cli qi+ -
c;i]
i= 1
To minirnise the cost, the above expression is differentiated with respect to
qi and it is made equal to zero and the following relationship is obtained.
If there is a limitation on inventories that requires that an average number

of all inventories should not exceed I, the cost K is minimised under the
following condition:
.r n
238 Construction Management and r~annrng
If the above condition is not met the equality condition is obtained by

0
reducing one or more of the qi 's.
We set
where h is the Lagrangian mu!tiplier.
Now
which leads to
Now, one has to find h such that
This is best done by trial and error.

In some sites, there may be a restriction of storagle area as discusseld in the
following:
Let A be the maximum storage area available for n items and ai be the
storage area required by one unit of ith item.
The storage requirements constraint is:
The Lagrangian function for the problem is
which leads to
and
The value of hocan be best found by trial and error.

Resource Management an& rrrverrlurl/ 239
Fig. 11.8 Diagram related to example 1
Example 11.2 Cement is used in a precast plant at the rate of 30 tor1s per
month. The cost of cement is Rs 2,600/- per ton. The ordering cost per
.
.
order
---c
is Rs 125/- only and the holding cost including w:istage ar~d pilfer;ige is
about 4.5% of the average inventory cost. Estimat:e the ecronomic order
quantity of cement.
Solution
Let R = Price of ct: ?r ton, N,,= Economic or(3er quar~tity,A = Total
rupee value of cement usea per month, P =Ordering cost. ror each order, and
P
C = Carrying cost expressed as a percentage of average inventory.

Total Cost (TC) = Ordering cost + Carrying cost
-
LAP
"u=Vz
I2x30x2600x 125
= 8 ton:
(2600)~
(0.045)
240 clvrrarruc.rrvrr rvrarrayerrrerrt crrru rrarrrrrr
Example 11.3 A contractor has set up st beam making plant in a

congested site. The site has very iittle storing space and thus requires the
beams to be produced almost at the rate at which they can be placed iin
position. The plant has a capacity to produce 2,500 beams per wee1k. The cost
of storing beam is negligible and is assumed as Re 1/- ve- -*.- '- rh, LUJL
IILC",,4.
af
setup for the plant for each production r iO/-. The 2s
1,000 beams per week.
(a) What is the optimum number of Imits to p roduce irI a produ 1?
(b) What is the total cost of prod ucing arld storin.g the cc Is
requirements for beams?
on runs 13e made'
(c) How frequently should producti~
Assuming, Q=Number of beams Fler prodllction m Jumber (3f
beams required each week, K = Number of beams produced :per wee.k,
H = Cost of storing one beam per week, S = Cost of settir%UP a 1)roductia~n
run, and t = Time interval in weeks between production runs.
From Fig. 11.8, the length of production run,
the 1c productic3n cycle,
ge cost Fber cycle,

1
-; x A C x j
7 L L
Total cost per cycle =
rota1 coslt per weeIk (TC) =
lifferentiate with respect ct
nits
4083 bea
weeks
= 2 x 50
= 4.08 weeks
~ { l O 0 O O.Ol(1-
x (1000,2500))
h
Substituting for Q,
TC = ~ { ~ S D H-[(D/K)]}
I per week
d
= (2 x 50 x 1000 x 0.01[1- (1000/2500)]}
= Rs 24.50 per weck
.. .Example 11.4In an out-of-town site, the project manager notices that work
is being disrupted for want of fuel. An investigation reveals the following
data:
(a) Fuel is brought to site five times a month.
fb) Probabi-litiesof fuel usage during reorder period.
rjemand in litres No. of Probabilities
during times
reorder period
The out-of-stock cost of diesel is relatively high due to the disruption of the
schedule and is estimated to be Rs 50/- per litre. The carrying cost is Rs lo/-
per litre including losses. The project manager intends to estimate the
optimum level of safety stock.
The project manager intuitively decides that he should at least stock 300
litres to overcome the major demand which has a probability of 0.68. The
additional stock is estimated as follows:
Expected monthly cost = no. short x probability x stock out cost
x no. of orders
The costs of being out of stock is estimated as follows:

Safety Probability of Number Expected Total monthly
stock being out short monthly cost stock out cost
0 0.09 when use 350 50 5.0 x 0.9 x 50 x 5 = 1125
0.07 when use 400 100 100 x .07 x 50 x 5 = 1750
0.03 when use 450 150 150 x .03 x 50 x 5 = 1125
50 0.07 when use 400 50 50 x .07 x 50 x 5 = 875
i 0.03 when use 450 100 100 x .03 x 50 x 5 = 750

RS 1,625/-
100 0.03 when use 450 50 50 x .03 x 50 x 5 = 375
Rs 375/-
150 0 when use 450 0 0 Rs O/-
Carrying cost = litres carried x cost/month

The total cost of safety stock is estimated as follows:
Cost of being Monthly Total cost
out-of-stock carrying cost
stock (Rs)
(Rs) (Rs)
The additional stock of petrol should be 150 litres.
Example 11.5 A project manager buys craft paper as lining for shuttering
from the market. The records indicate the following data. Monthly require-
ment: 2000 rolls, Price of roll: Rs 20/- each, Order cost: Rs 50/- order,
Carrying cost including pilferage and wastage: 25% of inventory value,
Quantity discount: 3% for 500 rolls and 5% for 1000 rolls. Estimate the
economic order quantity.
Solution
Annual purchase: 2000 x Rs 20/- = Rs 40,000/-
EOQ (without price discount) = d{2 401000 50 = 200 rolls per o d e r

(20)'(0.25)
The price discounts are evaluated in the followin

Quantity ordereu
--
200 rolls 1 500 ro-l rolls
Ordering cost:
Price
Rupees in one order
Average inventory
Carrying cost (25%)
Purchasing cost:
No. of orders/month 2000/20 = 10 Nos.
Monthly purchasing cost (Rs) 1 10 x 50/- = 500/- 1
Material cost:
Craft paper rolls with discounts
I I
Total ordering, purchasing and
material cost
The EOQ with price discount would be Rs 500 rc
Example 11.6 The directors of a real estate firm cannot really determine the
-,
out-of-stock cost of apartments for sale. The opportunity cost and the loss of
goodwill is too complicated to be estimated by the board o rs. The
board is not concerned as long as there are sufficient flats under construction.
. . .
When the numbers of vacant flats fall under 400, the company starts looking
for new projects. The board has examined the records of customer enquiries
and has estimated that the customer enquires during the reorder period is
normally distributed having p = 400 flats and 0 = 150 flats. The cost of
carrying inventory of flats is Rs 5,000/- per year per flat. Estimiate the
relationship between the service level and the inventory cost so tl at the
board may take a judicious decision.
The probability density function (Chapter V) may be used to estimate the
probability of making available a flat to a client, i.e., service level and the
number of safety stock.
For 95% service level, 1.64 0, i.e., 246 flats required.
Therefore, the cost of inventory: 246 x 5,000 = Rs 12,30,000/-. Simila~rly,the
number of flats and the associated inventory carrying costs for the tclllvuJ r-w.r...c
levels of service are presented in the following table:

Service No. of std. No. of Annual

Approximate cost of 1%
level dev. to the safety cost of
increase in service level
desired right of mean stock safety stock
6,30,000 - 0
50 0 0 0 = 21,000/-
30
9,60,000 - 6,30,000
80 .84 126 6,30,000/- = 33,000/-
10
90 1.28 192 9,60,000/- 12,30,000 - 9,60,000 = 54,000/-

5
95 1.64 246 12,30,000/- 17,50,000- 12,30,000 = 1,30,000/-

4
99 2.33 350 17,50,000/- 23,15,000 - 17,50,000 = 6,27,m,-

0.9
99.9 3.09 463 23,15,000/-
I
One may study from the table that the cost of inventory above 95% service
level increases with a great amount. Therefore, the board of directors decided
to provide a service level of 95%. In other words, a safety stock of 246 number
flats are required before looking for new ventures.
Example 11.7 In a factory the average stock level should be around 750
including all items due to financial restrictions. There are three products,
details of which are given below:
~
I
Stocks
Holding cost per unit per time
1
0.05
2
0.0 0.04
3
Set up cost per production run 50 40 60

Rate of demand per unit time 100 120 75
Estimate the optimal production quantities.
I Solution
-\I-=
I
Product 1 q: = 0.05 447
Product 2 q; = dTF 2 x 4 0 ~ 1 2 0=693
Product 3 q: = -\I- 0.04

464
1604
Average inventory 1M)4= 802

2
The average inventory value exceeds 750.
Assuming h = 0.004 (by trial and error)
Resource Management and Inventon/ 3AF
Product 1 qp =
d :.;::u.,
---
Product 2 qp = dE%=
,
I
11.1
Product 3 qp =
Average inventory 1514= 757

2
d :;::,
--
As the average inventory is around 750, the problem is solved.
EXERCISES
Describe briefly how the manpower requirements ()fa projec,t is estima~tedand
tabulated.
11.2 What are the factors which affect the site product?vity?
11.3
, ..
Enumerate the non-productive factors that affect the labour productib
11.4 Describe with a flow diagram the steps required for materizrl manage
a construction firm.
11.5 What is in1rentory CIontrol? Describe with the 1 ketches t'rle basic
principle of inventory control.
11.6 Consider thc ....,.Ll.-.+
r~vvlclnin Fig. 11.2. How would Y V U
n >l +LO -n npower
deimand so that the 1,last demand (i.e., 1east num'ber of wa pears in

COI~secutive weeks?
nc
(A;- .,.
hTrr
,I workers 8, in third and fourth week)
r r r
..
11.7 A site consumes Rs 10,000/- worth of timber per month and maintaining the
inventory for timber it is estimated to be 12.5% of the average inventory. If the
ordering cost is Rs 25/- per order, estimate the most economic order value for
timber.
(Ans Rs 2,000/- per order)
11.8 The inventory information for four items i r t d u r r l l IB vlescluru LIL r l L r ICJ
Annual ve No. o f times

Item
(Rs) ordered,
4 24,000-/- 3
Minimise average inventory level without increa~ s b gthe purchasin~gwork
load. Alternatively, minimise the purchase worl< load without in1creasing
average inventory.
(Ans Average inventory: Rs 10,686/
Purchase work 11.63)
246 ~onstrucrronManagement ana r~ann~ns
7
11.9 The experience of a ig out of stock is su mrnarised below:

kock out Numb
its) timl
9ssuming me stuc~uurcosts are 11s r u l - per urut mu the carrying cost o

nventory per unit is Rs 20/-, Iestimate tlne optimum level of stockout inventor]
Ans Optimum safety stock: 50 units)
,.
-
1 1 . 1 ~A firm is buying about 10,000 NOS.or door hinges each year. The ordering cos
- 7
is Rs 30/- for each order and the carrying cost i the cost of the unit
The supplier offers the following discounts:
0-599 hinges Rs 7.50 each 600-9h mnges
~ n d abotre 1,000 h~inges &j 5.85 eacl1.
Zstimate tlhe EOQ and the tot,a1cost wi.th price d
. - -- - - - , .
Ans EW:1,000 hinges, total cost: KS 5Y,385/-)
- A .
1 construction equipment leasing firm rents roac1 rollers tc3 construction firm:
n the locality. It maintains a safety stock of five rc)ad rollers to cater tl-lesudder
. . ... . . ..
,equirementsof their regular clients. It has estimated that the sudden need fo.
heir regular clients is normally distributed with a p = 5 and a = 2.7. The leasin[
irm intends to service their regular clients at least 80% of time. The inventor]
:awing costs for idle road rollers is estimated to be Rs 1,500/- per month pel
mate (a) the inventory cost a,t 80% of iservice lei(el, and (I ,) suggest
he upper limit of semice letre1 the colnpany mi3y reason,ably provide to the
,--.-1: ents.
(7
Ans (a) Inventory carrying clost at 809b service 1eve1is Rs 12,000/- I,er month
(b) The comF)any shouId not increase senrices level beyond 9'9%)
1. Joshi LS "M'anpower . by CPN

T- -
,,I. of the Inst. of Engrs. (Indial,I Civ. Eng 59, March 1989.
Accounts Managem
Accounting is directed towards evaluating the financial position and

progress of an enterprise. Accounting considers all the financial transactions
of a company and presents the data in a highly structured form that explains
information about the financial health of the enterprise. Accounting is to a
large measure a classification process in which a variety of distinctions are
made in the monetary values to create a set of tables and charts like profit
'and loss statement and balance sheets to describe the financial history of an
cmterprise. Accountine" concepts or principles which dictate the classification
process are therefore vely important. A list of basic concep~tsare as follows:
1. Financial conditic)n (i.e., asset, liability, shareholders equity, 6!tc.)
Results o ons (i.e., revenue, expense:3, loss, in1come, prcofit, etc.)
Enterpris brporate entity, financial st:atement, etc.)
- .. .
4. COnhnulty (i.e., accounting time period, gomg concern, etc.)
Present fiairly (i.e., consistcncy, full disclosure, etc.)
. . . .-
In Order to ensure the un~tormquality, standards and concepts, accounts
are normally audited by chartered accountants who as certifiers enjoy certain
statutory privileges and obligations. Under normal circumstances, audited
balance sheets and profit and loss statements are the only objective docu-
rnents available to an outsider to evaluate the financial performances of a
company. Taxes due to the governments are also estimated according to the
audited accounts. The preparation and audit of the account is beyond the
scope of this chapter. llle preserlt discussion is limited to the basic:under-
standing of audited acccbunts adclressed to a beginner.
BASIC CONCEPTS
The principles of accounting are built on a foundation of a few basic concepts.

Oue must understand the concepts in order to draw conclusions from the
accounting statements. A few of the important concepts are listed below.
Money Measurement
111financial accounting, a record is made only on those facts that can be
directly expressed in monetary terms. This concept imposes a limitation on
the scope of an accounting report. A number of important information may
remain outside the accounting report because of this limitation. For example,
a lawsuit or a dispute among the partners of a firm, statutory restrictions
1.ausing hardship to the business, deteriorating labour relations, increasing
risk of a strike, advancing age of the founder-director of a small firm may
have significant impact upon the performance of the firm but these are not
reflected in the accounting statement by any means. It follows, then, that an
accounting report does not reflect all the important information about the
company.
Business Entity
Accounting are kept for business entities, as distinguished from the persons
;vho are associated with these entities. When the owner takes cash out of his
tlusiness, for example, the accounting records show that business has less
cash than previously, even though the real effect of this event to the owner
himself may have been negligible. When the owner injects fund to the
business the accounting records show it as owner's equity and would treat
it as a liability of the business to the owner. The entity concept has significant
clffect on the taxation of a firm as shown in the following example:
Two parMership firms have floated and incorporated a private limited
company. The profit earned by the company is taxed at company tax rate.
The after tax profit is earned by the partnership firms as profit and are taxed
at the firm's tax rate. The after tax profit from the firm is earned by the
partners arid is again taxed at the individual's tax rate. In accounting, each
account is treated as an entity irrespective of its ownership.
Going Concern
In accounting, a business is viewed as a mechanism for creating values for

perpetuity. Resources owned by the firm is shown as its purchase price less
accumulated depreciation. The current resale value is irrelevant since it is
assumed that these will not be sold as such but rather these would be used
in the creation of future output values.
Accounts Management 9Aa
Cost Reporting
The resources like securities, land, building, plant and equipment, that
a business owns are called assets. The real worth of an asset may change
with time for a variety of reasons. The assets in accounting are almost always
shown at its cost value less accumulated depreciatiion. The book value and
the market value of an asset may be quite different. The cost concept is used
for objectivity.
Double Entry System

The double entry system is true for most of the accounts. Every event mat
is recorded in the accounts affects at least two items, one each from tl:le asset
and the liability side. Accounting systems are so set up that m event is
entered on both sides and the following concept always remains trut-. 3.
Assets;= Liabilities+ Owners' ecpity

Dual entry systern, which has both conceptual a n d ,arithmetiical advantages,
is unive~
sally accepted.
Time of Realisal
A firm generally provides service and earns revenues continuously. The
cheque received in one accounting period may very well be for the service
rendered in a previous accounting period. When should the revenue be
recognised? Revenues are generally recognised in the period in which the
firm is reasonably certain that the amount would be received. The time of
realisation is not related to the actual receipt of cheque. For construction
companies, the time of realisation is ordinarily the date of submission of bills.
The concept has an important bearing upon cash flow and taxation. Income
tax is payable upon the bills that are raised but not yet realised. Therefore.
.- -- - - -
the fund for taxes for unpaid bills has to be arrange!d from cjther sources.
- Concept
Matching
Matchin!5 concept guides, that to the extent feasible, the costs are reported
as expertses in the period in which the associated revenue is reported.
Similarly,. CL,
uLc,~",~ ~ e iare
p ttaken
s as only advance received. When the r---'--
is provided, advance recei 'onsidere mues.
Consistency Concept
In accounting practice, mamy assurnptions are made for conducting account?
ing. The consistency concept requ ires that once a firm has (decided on one
method, it treats all subsiequent t?vents by the same method. If dj.fferent
methods are used for the siame clas:;of events, accounting info~rmationcannot
be confidently compared.
Materiality Concept
The accountant does not attempt to record events ro sucn aerau mar me
record-keeping itself becomes unjustified by the usefulness of the result. For
cnxample, in most of the construction site accounts, a paint drum once open
is considered as used. One may go into details like measuring the use of paint
on a daily basis and report the partly used drums as the owners' asset at any
given time. The materiality concept allows the accountant to decide the level
of detail that can be ignored.
ACCOUNTING SYSTEM AND BOOKKEEPING
An accounting system involves a number of boo1w or recc3rd-keeping. The

daily transactions of the firm are represented in thle books. A typica11project
accounting system is represented in the flow diagiram in Fiig. 12.1.
In Fig. 12.1, the planning and project managenlent esthnate the require-
ment of resources, i.e., indent for work executicIn. The Iresources; can be
obtained either through a cash or a bill purchase. Purchase creates an
inventory that are used for the work execution. Bill purchase follows bill
rc~eiptsthat are paid after verification from the site. Work execution follows
payments receivable from the clients.
The first step of the accounting entries invohres vouc.hers. W1ken cash
. I-..-
flows out of the firm, the account is debited by deoir vouchers. When cash
flows into the firm, the account is credited.
The heart of the system are the account books where records of the
vouchers are tabulated in a logical manner. In most cases, at least four
account books rlamely tihe journi31, bank book, pa rty ledgc?r and ca.sh book
are maintained.
-,.A
"
tions showing the names of accounts that are to be debitec1 or credited, the
amounts of debits and credits and any brief information a1bout the transac-
tion. A journal is the list where all vouchers are first recordled.
A ledger is a device for reclasslfylng; and summarising, by accounts,
information originally listed in a chronolcbgical orcler in the journal. A party
-
ledger shows the accounting position with lnaiviaual
1. . 1
parties like a client or
a supplier. Each page of the ledger is dedicated to an individual party. The
bill number, the amount payable or receivable and the advance paid or
received are shown in the ledger. The party ledger shows the daily account-
ing position with the individual parties.
Bank books maintain the daily records ctions w ith the bzmk. The
. .-
cheque details and the amounts transacted are recorded. lhe current balance
~xwitionin the bank accc>untare shown on a daily basis.
The -cash book reconis the plurchase and sale details of the fi rm. The
I
4
INDENT
D PROJECT MANAGEMENT
+
I CASH BILL SlTE WORK EXECU
PM
PURCHASE PURCHASE REGISTER
RECEIPTS BlLL
REGISTER
BlLL PA\(
I I
CASH BOOK
1
3
'ARTY LED(
ACCOUNT
_.. BOOKS
I
T I CREDIT VOUCHERS
--ACCOl
-
BANK RECONCILIATION 1 INTERNAL AUDIT
ACCOUNTING eONTROLS
- - - - - - - - A-
Fig. 12.1 Project accounting systen

remaining cash balance and bank balances on a daily basis are recorded in
the cash book.
The examples of the accounting books are presented in Figs. 12.2 and 12.3.
Number of other accounting books may become necessary for management
information. For example, special register for material purchase, labour
contract uses, petty cash book, etc. are maintained depending upon the
necessity.
A. CASH BOOK
Date: 02/04/92 Accounting year: 01/04/92-31/03/93
S1. Ledger Cash
Particulars
No. folio Debit C
To Opening Balance 10,000.00
1. BY' CONVEYANCE C O W 300.00
(Travelling expense for peons)
2. BY ACCOUNTING CHARGES ACHARG 500.00
(Paid for accounting charge)
3. TO STATE BANK, MAIN BRANCH BANK 1,000.00
(Withdrawn from bank by cheque)
By Balance C/o. 10,;
Total 11,000.00 11,C
6. BANKBOOK
Date: 02/04/92 Accounting year: 01/04/92-31
S1. Cash
Particulars Ledger folio
No. Debit C.
To Opening Balance 15,000.00
1. BY CASH A/C CODE CASH 1,000.00
(Withdrawn from bank)
2. BY S.K. STEEL CO. SUNDRY CREDIT
(Part payment for purchase)
3. TO R.B. RAO . SUNDRY DEBIT 2,000.00
(Part payment of sale bill
No. 1)
To Balance C/o. 13,000.00
Total 17,000.00 17,000.00
Fig. 12.2 Examples of Cash Book and Bank Book
All these books have two basic requirements. First, the idea of debit and
Accounts Managemenr zo.
credit equality is maintained. Whenever an account is debited or credited

the opposite is required to be done in the other appropriate account
Secondly, the books are balanced periodically. After the accountinig period
both sides are matched and the balanced figure in either debit or credit sid~
is used as the starting balance for the next period.
Several control features like bank reconciliations, internal audit an(
material balance are used to ensure the correct data compilation in the books
DEPRECIATION
Depreciation is the decrease in value. Professionals from different fields art

concerned with depreciation. To an economist, depreciation is the reductior
of the market value while to an eng'ineer it is the loss of proficiency, i.e.
physical deterioration. To an accountant, depreciation is the progressivt
amortisation of the book value of the asset. Depreciation accounting is :
system of accounting which aims to distribute the cost of tangible capita
assets less salvage value, if any, ovQ the estimated useful life of the unit ir
a systematic and rational manner.
As an illustration, a tangible capital asset say a concrete mixer wortl
Rs 90,000/- is purchased in the first year. The mixer can be used for five year!
and the scrap value is estimated to be Rs 10,000/-. In the first year, the valu:
of the mixer machine is shown as Rs 90,000/- in the machinery asset columr.
of the balance sheet. In the sixth year, when the machine is sold as scrap for
Rs 10,000/- the sum is shown in the monetary asset column of the balance
sheet and the value of the machinery asset is correspondingly reduced. The
machinery asset column in the balance sheet from the second to the fifth yea]
reflects the progressive decrease of the value of Rs 80,000/- during the lifc
span of the mixer machine. Such a decrease is made in the balance sheet b~
affecting depreciation expenses.
Depreciation has a major impact on the taxation. Depra accepted
as an expense in the balance sheet by the tax authori._--. --2recianor . '.
increases operating expenses thereby reduces profit and income tax. How-
ever, depreciation is not an actual cash outflow from the company. In thc
previous illustration if one assumes fifty per cent as marginal income ta>c
and neglects time value of money, the total savings in taxes is
A sum of Rs 40,000/- is saved in taxes by showing Rs 80,000/- as

depreciation expe!lses which is not actually a cash outflow. In other words,
the after tax cost cf the mixer machine is Rs 90,000/- less Rs 40,000/-, i.e.,
RS 50,000/-.
Almost all canital tangible assets like building, plant, machinery and
254 Construflion Management and Planning
equipment are depreciated in the balance sheet, Howeveir, the lanid is not
depreciable.
There aR several methods of accounting depreciation. Due to the time
value of money, accountants prefer an accelerated method that depreciate
faster in the earlier years and slower in the later years of the life span of the
asset. A few of the depreciation methods are presented be1dw:
Straight Line Method
The name of the method is derived from the fact that if the end-of-the-year
asset amounts are plotted, the result is a straight line with a slope equal to
the annual depreciation rate. The formula for straight - line depreciation is
represented by:
Cost - estimated salvaf ed maintenance
estimated life in years
If the cost is Rs 10,000/-, the e salvage value is Rs 1O , Clo/-, the
estimated total repair cost is Rs and estimated life is 5 yt?ars, the
annual depreciation cost is Rs 2,200/-. Thle net ass;et value at the entd of the
jlear is presented below in Table 12.1.
.
I
Table 12. I
-- --
Repair Net assel

Year tio on (Rs)
Expenditure (Rs) end
200 DO
200 DO
200 DO
- -
4 '200
- -
3 z,t
5 200
- 1,c
mditure rur repdlrs is maw, cnarges are eriected to the accumularea
depreciation.
Sum of the Years Method

This is an accek In method. The fc
r r 1- C
where ,reciati& Zest of asset, S = E salvage

value .of the asstet, n = Es life of asset in ye,ars, t = The year (>f life of
asset, and 21 =.l'he sum of digits trom 1 to n.

1
For an asset with a cost of Rs 2,300/-, an estimated :salvage 7ialue of
Accounts Management 255
Rs 200/- and an estimated life of 5 years, the yearly depreciation is presented

below in Table 12.2.
rable 12.:
Fraction of total Deprec

depreciation amour
5 / :15 7C
- Total
Declining-Balance Meth
In this method, a fixed rate is applied each year to th~
e net balzmce, the method
.. .. -
results in decreasing the annual charges for depreciation. ~nmany instances,
income tax rules and pr: ictices set the rat12 for d ereciation
~ 1. There are also
methods to deduce the raite. For ex ample, one may LLse the following formula
for the determination of h e rate:
Salvage value
Depreciation rate = 1 - n
Cost
For the above ex:ample, the depreciation rate would be 38.64 per cent. The
yearly depreciation is premsented below in Table 12.3.
'able 12.3
Year eciation Balance :

rn-1
-
or the purpose of incorne tax, 1h e rate approved by the authorities are
required to be us;ed. The accelerated methods have a clear iadvantag;e from
.. ..
the tax accounting point of view. The larger deductions in the early years
mean tax payments are postponed for a considerable period. From the
financial point of view, a cash outflow for the purchase of a capital asset is
compensated by less cash outflow arising out of a lesser amount of tax caused
by the depreciated expenses. In other words, a higher depreciation allowed
in the tax rules induces more investment in the capital asset.
BALANCE SHEET
The balance sheet depicts the status of a firm at the end of the accounting
period, i.e., the financial year. An example of balance sheet is presented in
Table 12.4. The assets are conventionally shown in the right hand column-
'and the liabilities are shown in the left hand column. The items mentioned
under the asset column are the resources owned by the concern on the date
of the balance sheet. The items mentioned under the liability column are the
claims upon the firm by the outsiders. Equities are the claims against the
ctntity by the owners of the firm. Both sides of the balance sheet is always
the same. It does not have any special significance with respect to the
financial health of the firm. The liability side lists the source from which the
husiness has obtained the capital to operate on the specified date. The asset
side shows the form in which the capital is engaged on the date.
Assets are the economic resources of the firm with which it operates.
Assets that can be quickly and easily converted into cash are called current
assets. Cash, securities, inventories, accounts receivables, etc. are classified
into current asset. Fixed assets are long-lived resources. The property, plant
:and equipment are classified into fixed assets. The essential distinction
between current and fixed asset are the time up to which the asset is expected
.to be owned.
I
C. JOURNAL BOOK
1)ate: 03/04/92 Accounting year: 01/04/92-31/03/93
No. I Particulars
~
I
-.
1.
2.
I
I Aganvalla & Sons A/c. Dr.
Aganvalla & Sons A/c. Cr.
1
( A01
A02
I
1 230.20 1
I
230.20
I (Adjustment entry between A01 & A02)
Total 230.20 230.20
D. GENERAL LEDGER
Accounting year: 01/04/92-31/03/93
SUNDRY DEBTORS CODE: SUNDRY DEBT
Date Particulars Ledger folio Debit Credit
Opening Balance 0.00
0'1/04/92 Sales Bill No. 1 to R.B. Rao 2,500.00
02/04/92 Our Bill No. 1 (part payment) BANK 2,000.00
Total 2,500.00 2000.00
Clos~ngBalance Rs 500.00 debit.
Fig. 12.3 Examples of Jou:nal Book and General Ledger
anagemei
Liabil ities are 1the firm':s obligation to other parties. Current liabilities are
obligatio~nsthat i!5 require!d to be met within a short time, say within a year.
Accounts payable, tax liability, accrued c!xpenses, etc. are' considered as
current liabilities. Owners' equity is the 0wners' CIontributi rds the
I
: 'capital of the firm. Retained earnings is the profit ithat has ned by
the firm but has not been 1 returned to the owners in the f om~ of dividend.
Retained earnings can also be viewed as the amounts retajlled by the firm
for its own use.
PROFIT AND LC)SS STATEMENT
Profit and loss statement is a summary of the revenues and expenses within
an accounting period. It is also called an income statement. An example is
provided in Table 12.4. Income statement is important in the sense that it
reports the earnings of the firm in the current financial year. Gross sale is the
total sale, i.e., turnover of the firm. The difference between the gross siale and
the cost of goods sold is the gross profit margin. The overhead depreciation
and other costs are deducted to obtain a net: profit m le estimated tax
is deducted to obtain a net income.
Relationship between B, ;beet and

Income Statement
The balance sheet is the status or the firm on a parbcu~araate. It shows the
form of the capital and how it is owned by the firm on a given da te. The
balance sheet is the cumulative effect of the firm's performance for ih;entire
.
life. Income statement concentrates on the firm's performance for the current
financial year. It determin es the net income of the firm for the said year. The
retained earnings (i.e., thc differenice between the net income and the stock
. .
holders dividend) from the mcome statement is transferred to the equity
column I3f the ba lance shctet.
RATIO ANALYSIS
The purpose of tlle ratio analysis is to form ideas or make pr.edictionsabout

I I -.
a firm in the conrexr orr some decision setting. A consrrucrion-.....
manager in
-L
many instances is faced with the problem of evaluating the financial position
of a firm. The evaluation becomes essential before awarding a contract
among competing firms. Similarly, a banker may find it necessary to judge
the solvency of tlle firm befon! granting loans or a shareholder may wish to
know the perfornlance of 1:he firm. In these instances, the financial statements
.. ,-.
are the only- objectlve
. rmancial document available to an outside evaluator.
A systernatic in\~estigatic )n of the financial staternents by ratio analysis
provides; an idea about the firm's standing and perjformancc
The primary method of the ratio analysis is the comparison of financial

relationships by placing the data in ratio form. The analysis involves three
types of comparisons namely:
1. Comparison of items within a single year statement
2. Comparison of items over time
3. Comparison of items among firms
A number of ratios have been proposed for analysis. These can be divided
into several categories
1. Earnings ratio
2. Capital structure/leverage ratios
3. Liquidity ratio
4. Turnover ratios
5. Fund flow ratios
To illustrate the ratio analysis a concise balance sheet of a firm is presented
in Table 12.4. A number of ratios are calculated in Table 12.5.
Table 12.4
XYZ Real Estate Pvt. Ltd.
Balance Sheet as on 31.03.1 9xx
Liabilities Rs Assets Rs
Current liabilities 2,250,000 Cash 200,000
Long term debt 1,750,000 Marketable securities 300,000
Stockholders equity 6,000,000 Accounts receivable 1,700,000
(300,000 shares Inventories 2,300,000
outstanding) Total current assets 4,500,000
Net property, plant,
equipment, 5,500,000
Total liabilities Rs 10,000,000 Total assets Rs 10,000,000
Profit & Loss Statement as on 31.03.19~~
Sales ... Rs 28,000,000

Less cost of goods sold ... Rs 18,000,000
Gross margin .. . Rs 10,00C,000
Less selling and overhead .. . Rs 7,000,000
Operating income ... Rs 3,000,000
Less interest .. . Rs 120,000
Rs 2,880,000
Less income tax ... Rs 1,380,000
Net income ... Rs 1,500,000
Dividend to stock holders ... Rs 1.000.000
Table 12.5 Selected financial ratio
1 Ratio I Components Calculation Value
1. Earnings ratio 1
Net income
(a) Earnings per share
Average no. of shares outstanding
Market price per share
(b) Price earnings ratio
Eamings per share
Dividend to common stock
(c) Payout ratio
(d) Rate of return on

I Net income
Net income
stockholders' equity Average stockholders' equity
(e) All capital Net income + after tax interest
earnings rate Average total asset
2. Capital structure ratio
Long term debt
:y ratio
Shareholders' equity
('J) 1nterest coverage amings be1Foreinteres
ratio Intelrest
3. Liquidity ratio
Current assets
(a) ( tio
Current liiabilities
nrrirb
YU'L'. arrntr ?nnnn
atio Current li
Table 12.5 Continued h)
Q)
0
1 Ratio I Calculation Value
0
4. Turnover Ratio
(a) Average collection
I rage accouints receivalbles
I
of receivables Mnntlil 11 YU.Y.I
uLY..L..AJ
calpc
come
Net in-
'refit mar,gin ratio
Net ;ales
,
Isset turn over
-nventory turnover
I --5 Net ,ale>
Average t otal asset

Cost of gc~ o dsold
s
Average irlvcrilu~y
5. Funcl Statemer ~t Ratio
-
>ncn...-;.,n 4.4,.+..1
v',
,.-. assets 2,200,000 31.55 2'
(18,000,000 + 7,000,000 + 120,000 + 1,380,000 - 1,400,000)1360
I, L L C L
Daily fund expendih~res days
Fund provided by operations
:ash flow to debt
Total liabilities
Additional data: The market price of common stock is R s 40/- per share.
.
Depreciation deducted in determining above net mcome ~-
is Rs 1,400,000. A
- - -
short description of each of the ratio is presented in the following:

Earnings per share is a widely used ratio. It is a Ineasure (3f the prc
of the firm from the shareholder's point of view. As most firms retam a
portiorI of earnings (i.e., dividend payout ratio is I.ess than one), the value of
share tends to increase over time due to change ir1 the retained eanlings per
share i1s opposed to the profitability of each s h a....~ r:U-..LA-bV C ~ L C,AL L . U,
..,
ever, the
EI'S remains to be a common measure for the prc of a firn1.
Price-earnings ratio is a measure of tl1e invest' :ctation 2ibout the
firm. In the dynamic business world, the future performance of a company
is influenced by many externalI decisions. The , ~g data which is
historical does not alurays ref11 ect the future ac nt. For example,
,obtaining a major contract would positively change - the future performance
in the next year and this cannot be seen in the prc~ s e nyea t ~r'sbalance sheet.
In such a case, the price of share in the stock exch,ange ten(Is to increase due
'- '--.?stars'
It> U lVt preference. Price-earnings ratio is ~ ~ L ~ J A L under
..&&;r,~
~ V C
.. these condi-
tions.
Payout ratio indicate!j the per cent of nlet incomle that ane paid ba~ckto the
. .. .
stoc~-nolders.A high percentage indicates less retamea earnmgs ror rurure
1 r .
expansion. From the investor's point of view, higher dividends indicate more
annual income and more taxes. Less percentage indicates less annual income
and less taxes but more sale value of the stock attracting more capital gain
taxes. The diffc?rential tax rate between the incorne and capital gain of an
indiviciual investor is a guiding factor for the choice of stock of that particular
IIIVCJLI Ir.
Ratc? of return o n t h e .stock-holIders' equity is a rneasure c)f the prc,fitability
of the firm. It excludes the effecit of the fund sup]died by the creditors. The
ratio reveals how profit:ably the owner's funds a re utilisem d by the' firm. In
other words, it is a mtmure ojf the performanc~ e of the firm in financial
management.
All 1zapital earning rate is a ratio reflecting the overal.1 performance of the
capital employed by the firm. The numerator of this ratio is defined as the
net inc:ome plus net interest after income tax. Thus, the numerator is an
incoin<figure which is iindepenclent of the capital structureofthef 'irm. The
higher the ratio, the more efficie:nt is the use of the capital
Cav, ital structure rahus : - - -.-l-L- _--_--_-I-
relare the various conlvu~~e~us,
I
IX., ~ ~ U I LNIU
Y
creditor's share that fc)rms the total capital of a firm. The relationship
between borrowed funcIs and o.wner's capital is ir measure of the
long term financial solvency or a firm which is founa m me debt-equity ratio.
The ratio is a measure of the financial leverage of a firm. It ir he firm's
abilitv to increase the total capital by obtaining loa ns over 2 eits own
equity. Increasing the leverage obviously attracts more interest which is

measured by the interest coverage ratio. It is sometimes called tirnes-inter-
est-eamed ratio. The basic distinction between the two types of ratios is that
the leverage ratio is based on the balance sheet, while the interest coverage
rittio is based on the profit and loss statement. One purpose of the capital
structure ratio is to provide a measure of solvency, the ability to meet
commitments. A second purpose of the capital structure ratio is to evaluate
tlie risk of the stock. As the leverage increases, the risk upon the stock
increases.
While the capital structure ratios are the measure of the firm's ability to
meel long term commitments, the liquidity ratios evaluate the firm's ability
to meet short term obligations. The short term liquidity is important for the
proper day-to-day functioning of the firm.
A current ratio is a measure of the short term liquidity. In some cases, the
usc of the current ratio is not appropriate. For example, the inclusion of
~nventoryin current assets may impair its usefulness. Inventory in some
business are not liquid assets and take a considerable amount of time to
convert into cash or receivables. This criticism has led to the use of quick or
acid-test ratio. In the quick ratio, cash, securities and receivables are included
as quick assets but inventory is excluded.
Turnover ratios are the measure of the business activity of the firm. The
average collection of receivables is a measure of the speed at which outstand-
:tig receivables are collected. Changes in this ratio may signal changes in
credit terms, changes in quality of customers to whom credit is extended or
changes in the quality of collection efforts. Profit margin ratio determines the
per cent of profit with respect to the turnover. Profit margirl ratio is one of
the basic measurement of the business health of the firm. A decrease in profit
margin ratio indicates difficult times for the firm in the long run. The asset
tur~ioverratio varies for different industries. Among the same type of
b~rsinesses,the higher asset turnover ratio indicates a better utilisation of the
asset in respect of the production of inventory with the use of the said asset.
The inventory turnover ratio is the time required to sell the average inventory
a t hand. A change in this ratio over time is induced by factors such as the
cost of holding inventories, changes in product mixes, changes in production
technology, etc.
Turnover ratios are very important in evaluating a firm's performance for
thc next few years. It is of special importance for an outsider to judge the
f inn's ability to execute contracts. A comprehensive use of turnover ratios is
developed and is called du Pont's system which is described subsequently
in this chapter.
Fund statement ratio emphasises upon the flow of fund in the operation
of thc company. A bank or a short term creditor is more interested to know
the risk of the credit within the credit period. Defen! .val ratio is the
duration up to which a firm can operate in normal cbndition withoh, rC ?"rr
u,y
cash inflow. Cash flow to debt is a measure of the portion of the total liability
that can be met from the cash generated by the normal business operation
of the firm. I
I
!
II U PON'r SYSTEM FOR APPRAISING I
I
I
A construction m ~ f t e nencounters a situation where the earning
power of a firm is i to be judged. For example; an owner may wish
to evaluate the earning power of two competing fir& before awarding a
contract. Du Pont's chart which is described in Fig. 12.4 can be conveniently
used for such a purpose.
1
Rate of retlurn on investment
of sales
wNet profit divided ,, , wc
Gross profit = sales k?SS cost of goods I
+,
sold
minus
Expenses: Selling, administrative,
others
assets ,,nu. $q
minus blternatively
pz--j I Shareholders' equity I
3wed fund:
l2!Y
~ d r r e nlia
t
-
Fiq. 12.4 Du Point Chart
I
The nest profit rnargin ojFafirmhndicates the efficien1 utilisation of assets.
However, a low profit margin does not necessarily &ply a lower rate of
return on investments if a firm has higher investment tdrnover. In Du Pont's
chart in Fig. 12.4, both the net profit margin and the indestrnent turnover are
zb4 ~onsrrucrionManagemenr ana nannrr
combined to obtain the rate of return strnent ratio whitch is also

r. .
~vterredto as the earning power or overall prorlraolllry
-I..*..--
I
orr .me
- 1
rlrn
Ratio analysis is widely used in assessing the perfc n
particularly by outsiders like bankers, creditors and clien
Liquidity position, long term solvency, operating efficiency, overall
profitability and performance can be evaluated by the ratio analysis. Indivi-
dual ratios may or may not carry much information. However, a set of ratios
when compared with similar ratios of other firms, in the same business or
with respect to time reveal much information about the firm.
Ratio analysis is easy to perform. Statistical techniques like the discri-
~ninnnta~alysisor the multip1le regres:sion ma! r becomt - rsome for
casual users.
Ratio analysis though widf ?ly used has selreral lim Different
accounting practices or the impact of inflation may distort the ratios. An
analyst should not be carried away by the apparently precise numerical
values of ratios. The overall indications from the ratios nevertheless provide
' reasonably accurate picture about a fir
1
INTERNAL AUDITING
Internal auditing can be described as a monitoring mechanism in tlhe systen
to ensure that the firm's financial and accounting policieIS,proceclures an(
controls are being followed.
Thr2 principal purpose of internal audliting is z1s follows:
1. To assist the management to evaluate the performance of employees
and supervisors.
To assist supervisors to locate the proble~ 2 close fc
and controls are necessary.
To ascertain if the firm's financial nd proce
duses are being implemented.
4. To ascertain if the expenses and resource uses are juuicious~yaone by
the supervisors.
5. To locate the areas where misappropriation, negligence and wastage
have taken place
6. To recommend c ! action where appropriate
The internal auditing tunction may operate on both a post-audit or
preaudit basis. Post-audit serves the useful purpose of reporting the fact, --
identifying errors of omission or commission and recommending steps for
improvement.
For a construction f irm, an internal audit in1~olvessc:rutiny of rates a t
which materials were 1mrchased or lab(~urerswere emp;loyed. Tl1e labouir
and material quantum are verified with respect to the work done. The
~naintenancecost incurred to maintain the equipment is compared with other
sil~iilarsites to evaluate the maintenance programme of the site managers.
Arithmetical errors, if any -in the vouchers are also checked. Normally,
internal auditors do not have sufficient time and resources to check all the
vouchers. Therefore, the vouchers are selected randomly based upon statis-
tical sampling techniques. If a problem area is located, detail scrutinies are
made.
At the conclusion of an audit, the internal auditor is responsible for
submitting a report identifying the objective and scope of study, the methods
used and his findings. The finding does not only show the number, percent-
age and type of errors but also suggests corrective actions.
STATUTORY AUDIT
This audit pertains to an examination of a firm's financial statements by an
independent auditor. The auditor being a Chartered Accountant, a member
of the Council of the Institute of Chartered Accountants of India, enjoys
certain statutory privileges and obligations. The audit, in this sense, may be
described as the process by which the auditor assures himself of the fairness
of the financialstatements, their conformity with generally accepted account-
ing principles and the consistency with which the accounting principles have
been applied from year to year. Under the current provisions of the Income
Tax Act (see 44AB, 1991),a firm having a turnover above forty lakhs of rupees
per year is required to obtain a detailed opinion of the auditors in the
prescribed form. Such a report describes the accounting and financial details
of the firm in addition to certifying financial statements. The auditor's reports
are brief but reveals substantial details to an expert. Financial statements and
reports certified by the auditor are the basis of evaluation of the firm by
outsiders like tax authorities, bankers, clients, and stockholders.The auditing
procedure involves the following :
1. Observation
2. Inspection
3. Confirmation
4. Comparison
5. Analysis
6. Computation
7. Inquiry
8. Certification
The audit is normally conducted on a test basis. The auditor observes the
firm's accounting process, internal control etc. to gain an insight about the
possible loop holes. The auditor confirms sample vouchers. For example, an
advance received by a client may be confirmed by the auditor independently.
The auditor may inspect to verify the accounting data. For example, the
auditor may like to inspect the inventory to check whether the actual
inventory matches with the figures in the book. The auditor compares
extensively with previous financial statements to discover significant varia-
tions. Auditing involves extensive computations. For example, the deprecia-
tion claimed by the company may be computed independently by the auditor
to verify the firm's claim. Auditing sometimes involves inquiry. For example,
an auditor may independently enquire about an ongoing lawsuit against the
firm that have a significant bearing on the financial matters. Finally, the
auditor certifies that the financial statements and reports prepared by the
firm are correct and fairly representative of the firm's financial affairs to the
public at large.
TAXATION
Tax management normally comes under the accounting management section

of a firm. About sixty per,cent or more of the net income of most medium
or large sized firms are levied as income taxes. In addition, a number of other
taxes like turnover tax, wealth tax, capital gain tax, works contract tax and
sales tax are enforceable upon the firm. Therefore, tax management is vitally
important for any firm.
Tax planning refers to take advantage of the various tax shields that are
offered under the act. There is nothing wrong in taking actions that lower
the tax. However, tax evasion which is a criminal offence refers to the
suppression of material information to avoid taxes. Attempts to evade taxes
is not justified under any circumstance. Tax planning is also a complicated
affair. Income tax laws and its application in practice is cumbersome in
nature. One may not know whether a claim made under the provision of the
act are accepted by the assessing officer. In many instances, the cases are
required to be settled in higher administrative and/or judicial levels. In most
cases, the facts are revealed from the accounting entries. The arguments
placed by both the sides only try to explain the fact from different law points.
Accounting entries or any action plan as described in the account books are
therefore important from the point of view of taxation. Continuous advice
from tax consultants is essential and very common to most firms. Any major
decision like the purchase and sale of an asset, a new venture, etc. is therefore
required to be discussed with a tax consultant before any accounting entries
are made in the book.
Example 12.1. The following are the ratios relating to the activities of a
company.
Stock velocity 8 months
Gross profit ratio 25%
Amounrs rvrarrayarrrer
Gross profit for the year ending 31st December amounts to Rs 4,00
Closing stock of the year is Rs 10,000/- above the ouenine stock. Es
(a) the sales, and (b) closkg stock
Solution
Gross profit
(a) Gross profit ratio =
Sales
41001000
Sales = -- x 100 = Rs 16,00,Cloo/-
0.25
(b) Closing stock: Stock turnover takes 8 monthIS.
i.e., Inventory turnover ratio = = 1.5

12
Cost of goods sold
Inventory turnover ratio=
Average inventory
- Sales - gross profit

Average inventory
RS 12,00,,""
mn-,1-
or, 1.5 =
Average inventory
or, Average inventory= Rs 8,00,00

1
Prf Closing stock - Opening stock= Rs 10,000,
Closing stock + Opening stock

- Rs 8,00,00
2
or, " stock + Opening stock= Rs 16,00,C

Closinp;
From thce above c

2 x Openlng stock = Rs 16,00,000 - Rs-11J - I J I J I ~ -I
- , - - - I
Or, Opening stock = Rs 7,95,00
.. Closing stock = Rs 7,95,00v + 1- nnn

LU,UUUI -
Example 12.2 A firm has applied to a bank for a s hort ternI loan. The loan
officer has collected the ratios for the last two ye;ars for tl~e firm and the
similar industry averages which are presented. LIATr;+n
Y I A L C : a small report to
.r
recommend/or not to recommend the loan. Show reasons in your recom-

mendatioh.
- .
268 Cvrratr UUICNI Manautlllclll ~ I I Planning
J
Soliitio
iancial Ratios
~dustry
Ratio 1986 19: :andard
Liquidity
Current ratio 1.33
Acid test ratio 1.00 1.00
Basic Defen~iveInten 48.35 58.00 days
"
Receivable turnover ratlo 13.13 14.-A 60 time!
Average collection period 27.76 24. 00 days
Inventory turnover ratio 10.07 10. 72 times
Leverage
Debt ratio 0.54 53 0.49
Long term debt ratio 0.22 0.26 0.24
in1:erest coverage ratic 3.59 3.24 3.41
. . .....,
Prnfitalbility
,ass profit margin 0.32 0.

!t profit margin 9 0.016 0.
turn on tc~talasset 7 0.032 0.034
turn on common ec 1 0.068 0.067
.. .
- WE
The major task of the! loan off

lrgin u.u~O 0.044 0.045
I evaluate the ability of the firm in
repayii~g the loan. Tht,, 1r t h ~f

,ust .,.,
concern are the liquidity ratios. The
company's overall measure of liquidity, i.e., current ratio, acid test ratio, etc.
are all slightly below the corresponding industry norms. It is noted that
overall liquidity has increased in 1987 from 1986. Although - the improvement
o f liquidity has taken place, the 1firm is still below similar 1Srms with regard
to liquidity.
Liquidity in specific assets show +I..-.+ +I 42-
.r.r .,.
.l
u t a L ute lull1l l a n ullylu~ed its E ."-:.?-Ll"
~ e l v a v ~ e
t umov,er and inventory turnover to be 1: m that of the inclustry. It

indicates that the management has taken 2 steps to face tht? current
l:-.*:A:,
l~uulultyposition.
The leverage ratios show that the firm has taken advantages of more
leverag;e than the similar firms in the industry. The company's use of current
. 1 - 1
drht i s slightly above the industry norm as seen from the above average aeD1: I
~dbelow average long-tenm debt rlitio. The interest coverage ratio has
jed from 1986 to 1987. The bank shc)uld look whether the dete.rioration
in coverage ratios resulted from lower income, higher finance changes or a

(.ombination of the two.
The profitability ratios show that the firm has identical gross profit margin
with other firms in the industry. The operating income margin is slightly
lower than the norm, a fact indicating that operating expenses are slightly
higher as a per cent of sales than the norm.
The net profit margin is little less than the industry norm. It has probably
twen caused by higher interest changes and higher operating income of the
firm.
The firm's return on total asset and operating income margin is little less
than the industry norm. This is expected because both gross and net profit
margin is less than the industry norm.
In summary, the ratios indicate the following:
1. The company's liquidity has increased in the last two years probably
because of adequate management of current assets. Howevet; Lle
company still faces liquidity problems in relation to similar firms in
the industry.
2. The firm has used in the last two years higher le han the
industry norm.
3. The current liabilities constitute a larger portion of total debt than is
common in the trade.
4. The overall profitability of the firm is little lower than the industry
probably because of higher operating income and finance changes.
However, the profitability on owner's equity is higher than the norm
due to higher leverage.
Rr~conzliznzdation: As the firm has lower liquidity and lower overall profit
margin and higher leverage the loan is relatively risky. Therefore, the loan
should not be ordinarily granted at a concessional rate. However, the firm is
not in an extreme position. Therefore the loan may be granted with ag-
propriate interest rate and collateral security to cover the financial risk.
EXERCISES
12.1 Explain how the change in depreciation rate may affect the profitability of a
firm.
.I 2.2 Describe the basic concepts on which the accounting systems are based.
12.3 Explain why a firm may have to pay taxes upon an income that has not been
received yet.
12.4 Explain and discuss the statement "Accounts may fail to recognise many
important aspects of a firm".
12.5 Explain why an owner's equity is shown in the liabilities side of the balance
sheet of a firm.
.12.6 The value of a land is ,always shown.at the cost price in the balance of the
.-. .
subsequent years whereas the market price may have increased a lot. What is
the justification of such reporting?
12.7 An owner of a private limited firm may pay taxes upon the income of the firm
and would again pay taxes on the dividend received from the firm. What is
the justification for such double taxation?
12.8 Describe with a flow diagram the accounting system of a construction firm.
12.9 What is the relationship between the balance sheet and the profit and loss
statement?
12.10 What is the ratio analysis? Explain with a few examples.
12.11 Describe with a flow diagram the Du Pont's method of ratio analysis.
12.12 Describe the difference between an internal audit and a statutory audit.
12.13 Describe the principal purpose of internal auditing.
12.14 The purchase cost of an equipment is Rs 1,100/- and the salvage value after
10 years of useful life is estimated to be Rs loo/-. Assuming 20% depreciation
for each year is allowed for declining balance method by tax authorities
estimate the remaining value of the equipment.that would not be depreciated
after 10 years.
(Ans Rs 2R/-)
12.15 A company sells p o d s on cash as well as on credit. The following particulars
are extracted from their books of accounts for the calendar year 1991:
Total gross sales Rs 1,00,000/-
Cash sales (included in gross sales) Rs 20,000/-
Sales returns ' Rs 7,000/-
Total debtors for sales as an 31.12.91 Rs 9,000/-
Bills receivable on 31.12.91 Rs 2,000/-
Provisions for doubtful debts on 31.12.91 Rs 1,000/-
Total creditors on 31.12.91 Rs 10,000/-
Calculate the average collection period.
(Ans 55 days)
12.16 The following are the ratios relating to the activities of a company:
Debtors velocity 3 months
Stock velocity 8 months
Creditors velocity 2 months
Gross profit ratio 25%
Gross profit for the year ended 31st Tec 1991 amounts to Rs 4,00,000/-.
Closing stock of the year is Rs 10,000/- above opening stock. Bills receivable
amount to Rs 25,000/- and bills payable to Rs 10,000/-.
Find out (a) Sales, (b) Sundry debtors, (c) Closing stock, and (d) Sundry
creditors.
(Ans (a) Rs 16,00,000/-, (b) Rs 3,25,000/-, (c) Rs 8,00,000/-, (d) Rs 12,10,000/-)
12.17 The managing director of a construction firm contacted the bank with regard
to a short term loan. The loan was to be used to repay notes payable and to
finance current assets. The director requested a one year maturity on the loan.
Upon receiving the loan request, the bank requested that the firm supply it
with complete financial statements for the two previous years.
These statements are as follows:
Balance Sheets (year ending March 1989)

1987 1988
Rs Rs
Cash 18,000 1,000
Accounts receivable 25,000 32,000
Inventories 58,000 91,000
Total current assets 1,01,000 1,24,000
Land 40,000 52,000
Building and Equipment 1,40,000 2,00,000
Less: Allowance for depreciation (56,000) (76,000)
Total fixed assets 1,24,000 1,76,000
Total assets 2,25,000 3,00,000
Accounts payable 21,000 44,000
Bank notes 34,000 94,000
Total current liabilities 55,000 1,38,000 -
Long term debt 57,500 45,900
Common stock 63,000 63,000
Retained earnings 49,500 53,100
Total liabilities 2,25,000 3,00,000
272 -
C ~ r r ~ l r u ~ l r r uv r arr r a y G r r r G r r l a r r u r r a r r r r r r r y
Income 9tatement!s (year eriding Ma1
- -
!Sales:
Sales nnn
Cost c)f good sc)Id

Gross PIrofit
Operating expenses:
Fixed cash operating expenses
Variable operating expenses
Depreciation
Total operating er
Earnings before u
Interest
Earnings before taxes
Taxes
Net Income
(a) On the basis of the preceding statements, cornplete the 1following table:
Ratio Analy:sis
- I
1
InIdustry Actual
a.verage 1987
1.801 times
Acid-test ratio 0.70I
Average collectior1 periodI 37 clays
lnvenrory turnover rarlo 2.501 times
Debt rat io
Long tel.m debt tc total
capitalization r;3tio
Time-interest-earned ratio 3.8 1
Gross profit margin 38%
Net profit margin 3.5'3
Return on total assets 4.0'3
(b) Analyse the status of the firm with respect to a loan request. snoula
the loan be grantt2d? Show reasons.
Cost Mz
INTRODUCTION
Cost estimating is one of the most important aspec,tsof con!struction manage-

ment. Several types of estimates depending upon the objecztives and resour-
ces of the decision maker can be prepared. As ekvcc~ru,the accuracv of a
cost estimate is proportional to the time and fund!s deploy(2d. A few types of
the cost estimates are the production function, orcler of ma gnitude, unit cost
for the bill of quantities, and control estimates.
Most of the cost esti:mates although IYlay be t emed
~ diff erently irI various
literatures are :perform6!d accorcling to aIne or a combination of tl2e above
basic approach,es.
PRODUCTION
In economics, the production function is defined as the relationshiP -0%

the quantity of an output Q and the q~lantum (3f various inputs namely,
XI, 9,. . . , xn to achieve it.
if (XI,X2, . . . ,xn)
The most sinnple and I exampl!ein cons is the esih a t e of
a building based upon the covered area. In this case, an inp ney (say,
Its 200/- in 1990) is found to be required on an average to p n output
of a unit square foot of covered area of standard specificatic sidential
building. The value of such estimates change with time mainly be!cause of
inflation, i.e. price increase. It also assumes that the scope of work. and the
specification is fully known. In common problems like the estirlate of a
residential building such information is generally known.
'
In other cases, the individual production fiunctions for the various
274 Consrrucrron w~anagemenrana riannmng
parameters may be combined to e~stimatethe project cost. In some literature,

-
it is termed as the paramerrlc .
...,
method. An example is provided below.
L.2
. Exampl i n industrial house is considering a plan to establish an art

gallery m a central location in the four metropolitan cities within the next
t I1 ree years. The following parameters are known-
Built-up area 1200 sq. m
Air-conditioned rantrally
Flooring:
Core area and lobby Ily marbled
Gallery rpeted
External cladding Distinctive stone and glass
bstimate for the funding required is to be determined.
Amount
)meter Quantity Unit IRate (Rs)
(in thousiand Rs)
I . Bullding (without floorira
' b 3-A U1.U 1200 aq. LAL
7 nnn 7 nr
tors)
mditioninig (with d ucts) 1200 sq. m
3. Marble flooring (30% area) 360 sq. m 500 4 ,-
4. Carpeting (70% area) 840 sq. m 700

5. Elevators 4 nos. 1,50,000
6. Exter~
la1 cladding 1100 sq. m
7. Land cost for built-up area 1200 sq. m
-
>tal
Assurning an iaverage price increase for the
",,"I
.- .,
1LC*
2 y c C L I J as 15% the total value
I
.,Am..,-
= Rs 90,36.7M
Assurning a contingency of 15"/b, the vallue = Rs 103,92
Estimate for four such galleries = Rs 41.5 n
The above estimate is approximate. Despite its inaccuracy, it serves a
useful purpose for the preliminary planning for the industrial I~ouse.
In order to make such an estimate, the estimator must have knowledge
and expcxience of the detiailed pric:e estimates of thc2 individ ual para
The estirnator mu1st also kllow the 1!ull scopc:and tiwe schedu le of the I
ORDER OF MAGNITUDE
One of the implicit assum f the previous est that cost varies
linearly with the output in more or less similar projects. In certain cases,
particula rly for c:hemica1 or proc~
ess industries, this may not be true. Ic
addition, a number of statistical studies conducted over the years have
..
developed a better idea about the cost-volume relationships particularly for
the chemical and process industries. Usually, tlle relatic derived
through regression analysis techniques.
The most common among such techniques is called the factored cost
metho,d. The cc1st of a I>lant,system or component can bc estirnated fairly
accurately by sluch a mc!thod. The most common formula :is:
fact0
Estimate?dcost =
New plant size
Reference plant size
1
x Price index x Location irldex
x Ref. plant cost
~,
Although the factoi is sometimes called the sixth tenth factor it depends
upon the system and may vary from 0.2 to 1.4 for different systems. The price
increase index accounts for the inflation and vrice rise. The location index
adjusts the price that mii~yarise (lue to comparatixre advanitage or d isadvan-
tage of the location of the project. The! factors may be found f'rom 'the
literature like woods.'
The sophisticated staitistical tlechniqueIS have cierived c:ost functions for
many process-equipmer~ twhich , L can be d to estimate the
cost of a system. Relevarlr l~reratureis he~prulio ouram a cost function for
-L l:L--.-,
the required sy!stem.

While using cost fLll~ctions,one mus eful abo;ut its sc~
ope and
- ..-.. - .
limitations. Otherwise, . .
gross errors may crop up m tne estimate.
UNIT COST FOR THE BILL OF QUANTITIES
This is the most important and widely used means for achieving the cost
estimates of civil construction. The work is divided into individual items. In
practice, the items have been standardised over the years. In India, items
used by PWD have been followed mostly as standard.
The system is simple and effective.-The unit cost is the summation of the
cost of materials, labour, equipment, overhead and profit. The practising cost -
engineer must be conversant wjth the method of ( ing the ulnit cost.
. In order to facilitate the estimation, standard 1 ks like the ones
published by National Buildings 0rganisation2 arc cVllllllVlllY ..",-..
--l-, -1 I
UJcU. -%,.
lllcac
har!dbooks provide a list of standard items and mateials, and labour inputs
to produce one unit of the standard items. The estimator ncxmally provides
the going LV *,.;.".a l l l ~ at
e the unit rate.
- rate of materials, labour and overheads &A
The rat.e analysis which gives fu~rtherde tails is p rovided .e in the
book.
276 Construction Management ana rlannmg
CONTF 'IMATES
Dirring me actual execution or tne construction, a detaled analysis or costs

are required to be made. The cos;t estimaltes prepared during the dlesign or
bidding stage may not be sufficieint or applicable during the! executic)nstage.
During the execution stage, the control estimate system serves two useful
purposes. First, it develops the production informzrtion for :materials, labour
iw~E~-&~ui~ment that can be used as input for futuIre estim,ates. Secondly, it
generates information so that
-
1 on6? may sh~ d to
v take correc:tive measures to
m inimise the cost at any step.
INDIRECT COS
Apart from the Idirect m: tterial, ec t and labour, the 1Llnit cost method
--- a11
generally c0mbhtt.s -11 -Ll L-- ---L- .L---1- TI . ---- -1 -.----I
uu1t.r cusrs UILUoverliedus. --L:--L--
111 cast.UI curlrlul esurrlares,
~ -
overheads may be divided into a numk direct cc)st estimates for

ruonitoring purposes. A checklist for such costs arc! provided here.
rary Utiliity
This in(~Iudesth~ecost 01 tion and manage]ment of water, ell
1:-. .._ __..-,_
and sewage ulspvsal 1 -:.-. - ~ ..
system. m a ciry area, these urilines may we purcnasea
I . . . - - - 1 - ~
directly from the public utility :system. In many instances, these may be
generated within the site
.Consumables
Consumables in 1 clothin c. Hard
hats, boots, goggles ror welamg, snoveis, spades, baslcets, tumbler locks, rags,
!ry, medical supplies, fuseIS,electric bulbs, hammers, wrenclhes, etc.
f the iterns can bi2 estimated as a percentage of lab0ur costs.
Cleanin'g
The co:;t of clei e site ar sal of n
.. . ...
estimated. It can be calculated as a percentage of labour hours and the
number of hauling truck:
a
Unloadi..,"
The cos jading m are requirred to b~ ted. Bulk.y items
like tra~ s, large ( pipes, and prefa stntcturit1 items
. - . .
may require special on 5;ite road:;and un[loading docks. If : the railhead or
ports are involved the cos,tof demiurrage in case of d.elayin rrlaterial h andling
may be substantial.
Cost Management 277
Transportation within the Job Site

The material handling cost within the site is required to be estimated. Bulky
items like the roof truss or precast piles that is required to be transported
within the site may be time-consuming and costly. Special access roads may
be required. In a labour-oriented construction site, material handling is
time-consuming. Any mistake in planning may become time-consuming and
costly. Transportation facilities within a job site may be taken as percentage
of material cost or a part of the transportation may be directly estin
Warehousing
A large amount of construction materials are required to be stored in site.
Special facilities are required to be made for this. The cost of a cement
godown, equipment storage godown, etc. are directly estimated. The cost of
devices for safety and anti-pilferage are required to be estimated.
Workshop
In a large site, a number of construction machinery are deployed. In most
sites the machines are not used and maintained well. The machines operate
through extreme clhates and in an environment containing dust and mud.
Machines require continuous maintenance and replacement. A workshop
having minimum facilities are required in a site, the cost of which should be
estimated.
Laboratory
Construction materials are required, to be routinely checked for quality
control. l l ~ cost
e of establishing and operating a laboratory are required-to
be estimated.
Construction Office
For some sites, temporary or mobile structure is sufficient for the construc-
tion office. In most situation, a semi-permanent office is required for a
construction office. The size depends upon the number of people that must
be accommodated. Sufficient storage for files is required for safe keeping. In
an extreme climate, the office is required to be temperature-controlled.
Communication
Communications with outside and inside the site are very I I I ~ ~ V I L ~The
~ ~ .
cost may not be much while the public systems are used. In many cases,
private wireless systems are required to be established and maintained. In
remote sites, considerable expenses may be involved for the construction of
microwave towers, dish antenna, etc.
Safety and Medical

Safety and medical costs will depend upon the labour force, and the type of
construction. Medical costs and supplies are to be included.
Quality Assurance
Quality assurance programme is an important factor for any construction
site. Routine tests for aggregates, concrete and welding are required to be
made. In addition, incoming supplies are required to be checked routinely.
The cost of a quality assurance programme depends upon manpower and
consumables deployed.
Catering
As construction work is continued for long hours, the arrangement for
catering is made in many sites. For remote sites, catering is very important
and expensive. Catering cost depends upon the manpower deployed.
Hospitality Cost
Various forms of hospitality costs are incurred. Visits from the corporate
office, architects or owners are the common cause of expenses.Visits from the
reguiatory agencies are also very common. For large sites, public relation and
communication with the press are also very important for the positive
pro-jection of corporate images. The cost of hospitality depends upon the
duration of the project.
Indirect Labour Cost

This is an important factor that is required to be estimated. Non-productive
labour cost arises for several reasons like bad weather, sick pay, employment
benefits, holiday pays, delay for test checking and measurements.
Project Management Cost

This is also an important source of expenditure to be controlled. The design
and management costs for shop drawings, scheduling, bill preparations,
material reconciliations and project management are required to be esti-
mated. The cost can be derived from an estimate of the manpower proposed
to be deployed.
Insurance
Insurance is a safeguard against risk. For an individual firm, the insurance
is the most cost-effective and probably the only method to deal with the risk
of an industrial accident. Insurance covers are generally available in a basic
policy with add-on facilities. The basic policy could be on natural hazards
like fire and earthquake, with add-on facilities like riot, strike and flood.
;t Management 27
There are also tailor-made all risk cover policy of the insur,ance firm
for constructioi~sites. Separate policies are also i for the c:ompens:
tion of workmen or third party risk. Insurance c
the indirect cost of a project.
CONTINGENCY
(:c>ntingencyis a cushion of cost to deal with the as becom

l*omplicatedbecause of the different definitionIS assum ed by the variot
parties. To the top management, contingency is the mone:y which would nc
t)c expended and would be returned as profit a~tthe enc1 of the project. 1
tmgineers, contingency is a savings account thalt can be drawn on to cow
thc additional costs of add-on features to thle project. To constructio
managers, contingency is an indirect cost like aI social p)arty and gifts thi
cannot be charged directly to the project.
Contingency, in principle, is intended tlo reduc:e the risl< of an over-run fc
a project executed under expected conditicIns. A flew of the factors that belon
t
to contingency are rnhnor desigp changes, underestimate of cost and quar

tities, lack of experience, unan ticipated price changes, corrections of minc
erroneous assumption:5, items rlot identified fully in the estimating stage an
some unforeseen regulations and safety problems.
Contingency may or may not include escalation and dlowances. Escali
I
tion is a provision in the estimated cost for inflation or COIntinuing price lev'
increase over time. Allowance is a fund included in the estimate for iten
that are known but cannot be defined to the extent to estimate the cost.
The method for developing contingency depends on the organisation, tl
type and duration of the project, the type of estimate ar~dthe pl-
project.
. c.
The subjective estimate by skilled professionals are most orten --
percentage difference between an estimated and an a st
projects provides a better idea of probable contingencies.
For large projects with different types of works, a weigntea average of
contingencies for each type of work may be used for the total pr,ejects. Fc3r
very large projects, techniques like the Monte Carlo simulation mi3y be useb d l
to ascertain the contingency or the risk of the .project.
. . The contingency is
generally included under a separate heiad in the project c
COST-VOLUME RELATIONSHIP
As the name suggests, the cos t-volumc: relation ship examines th

ship among csost, volume and 1profit.
The cost is divided into fixed and variable connponents;.The an: dysis plo
the cost and revenues against the volume of bus;hess (Fie;.13.1).TlIe revenl
280 C~rrsiruu~rvrr
marrauerrrerrl arru Plannina
per unii: exceed:; the va riable cc)st per Imit and is able to make some
---L:L.. -.-:A --.-lo -",.-*--:-- L:.*--I . n----
CU~~L~~VULLULU
.,.^A
I WC~IU~ I~LUVCIUI~
---I
ILXCU LWL. 111t: volume at which all of the
fixed costs as well as the variable costs are recovered is the E 1 point.
An example is presented below.
Break-even
Point
Cost
/ 1 I
Example 13.1 A construction firm is considering to execute a structural

modifica tion project in a running manufacturing mill. Due to telchnical
reasons, the work is to be executed slowly and carefully.
It is expected that only 20 tons of fabrication is possible in each I
The firnI has estimated the following cost figures. The problem
determirle the rate that should be quoted by the fin
Fixed cost, i.e. equipment, supervision and
overhead deployment cost RS I,SU,UUU per mon,.
Variat)le cost, i.e. labour and mz 30,000 per mon.
Norm a1 cost ojf fabrication 35,000 per mon
Breakeven point a~tnormal1 cost = - D tons
3.
At least 30 tons of fabrication is re( breakemen at the normal c
- . -
this case the expected production is only 20 tons. Therefore, the price must
be increa~sedto b~reakeven
The breakeven at 20 ton I)er month production rate shall be at Rs 37,500/-

pnce per ton. Assuming a profit or,- about 10% quoted rate shall be Rs 41,000/-
r..
per ton.
Cost Managemen+ OQi
COST CONTROL SYSTE
The ability to estimate constr~ctioncosts accurately is a key element for the

success of any contracting firm. A workable and reliable cost reporting
system plays a vital role in the proper management of a construction project.
A large complex job requires a detailed complex reporting and information
system whereas a simpler system is sufficient for smaller projects. At any
event, the control must produce timely information. If the information is
-
dated or unsuitable for practical use, the purpose of the control system is
defeated
ProjecLLVJL accounting is the key ingredient in the project cost system.
Cost accounting differs substantially from financial accounting. Cost
accounting relates solely to determining the detailed requirements and the
associated cost of a product. Financial accounting is normaly made in terms
of monetary units. Cost accounting is concerned with the quantity of
materials, labour productivity in addition to the money value. The systematic
and regular checking of cost is a necessary part of obtaining reliable
production information. Occasional spot checks may not always provide a
true picture of the productivity. The project cost accounting system supple-
ments field supervision. Field supervisors can be alerted in case of a cost
over-run. Site supervisors are the key members of the cost control team and
without their support and cooperation the job cost system cannot and will
not perform satisfactorily.
Basic System of Cost Control

An example of a basic cost control flow diagram is slLuvvLL
U L Fig. 13.2. IA"---
V V I L C I L
financial accounting is maintained in a computer system, such an analysis . .

can be obtained almost as a byproduct with minimal investment oif extra
manpower.
I Resource
input 1- I Resource
1q.-Zq-,
lnvenrory
inventory
"it ,
resources
analysis
inventow
I ,.ll~zation 1
_I I
low diagrarn of a basic cost cont,rol system

282 'Construction Management and Planning
An integrated financial accounting software package that maintains in-

ventory linked with the production that are widely available in the market
can be suitably modified for the particular use as shown in the flow diagram.
A brief description is provided. Resource inputs are made when the
description of the bills for material and labour supply are entered in the
computer. This is always required for any financial programme. Inventory
files are created by a computer and are normally presented as in Table 13.1
Table 73.7 Resources inventory

Date:
Resources Qty AVP Rate rrlce
Cement Bags
Sand CU. m
Stonechips CU. m
Bricks Nos
Steel 6 mm MT
Steel 8 mm MT
Mason Nos
Carpenter Nos
Bar binder Nos
Concreting Rs
Diesel Litres
Petrol Litres
Concrete Mixer Hours
Vibrator Hours
The quantity, rate and price are normally shown. The price is obtained
from the summation of the bill values and the average rates are derived.
After a passage of time, when some productions are made the bills are
raised. As most of the construction contracts are awarded on an item rate
basis, the bills are the detaiIed measurement of production. This can be used
as the finished item inventory. An example is shown in Table 13.2
Table 73.2 Finished item inventory

Bill No.
Date:
Item Qty. Rate Amount
-
1. Brickwork CU, m
2. R.C.C. CU. m
3. Steelwork MT
4. Plaster M~
Cost Management 283
When such bills are prepared by the computer, the resources required to
produce the finished items are estimated by the computer. The conversion
o f raw materials to finished goods are made upon the conversion constants
already stored in the computer. In this case, the standard materials constant
that are available in handbooks or PWD manuals are used. The balance raw
materials are automatically calculated and are shown in the inventory output
by the computer. An actual site checking is made on the date of the
measurement for the bill. A comparison between the actual site inventory
and the balance theoretical inventory produced by the computer gives an
idea about the variation of the material used with the theoretical quantities.
One would also ascertain from the monetary values the actual cost of the
production or profit accrued in the time period. The obvious advantage of
the system is limited to the manpower requirement. The bills for the
incoming supply and outgoing product are required to maintain in the
software system for financial accounting. Inventory and cost control can be
done with the same database. The major disadvantage is that the raw
materials that are used in the different finished product are combined. For
clxample, sand or cement may be used for concreting, brickwork and plaster.
One may not be able to account for cement for individual items. Cement may
be spoiled during plaster but with such a system it cannot be pin-pointed.
For smaller sites, overall checking of material costing may be sufficient. As
long as the total material consumption remains within control one may
assume that individual uses are alright. In case of a problem, one may initiate
a detailed system of cost control.
Detailed System of Cost Control

I11 the detailed system of cost control, meticulous cost figures are maintained.
Example blank forms are shown in Table 13.3. Daily material, labour and
equipment usage, and associated costs are collected. When the measurements
for bills are made, a cost report as shown in Table 13.4 is prepared. The
budgeted cost, cost during the time period and cumulative cost are collected.
In Table 13.4, the budgeted costs shown in columns 5, 8,11 and 14 are the
product of actual work done in this period shown in column 3 and the unit
rate estimated during the budget or tender preparation. The actual costs
shown in columns 6, 9, 12 and 15 are estimated from the summation of
respective daily data shown in Table 13.3.
The actual cost and the budgeted cost are compared and are shown in
Table 13.5. The profit or loss for each item are compared for the said time
period and total duration of the work. The deviation from the budget are
ilso indicated. One may decide from Table 13.5 what are the items that
require special cost control and attention during the execution of the work.
The projection of profit and loss can also be estimated.
284 Construction Management ancl rrdrrrrrrry
Table 13
y material
Project: Weather:
Date: prensred by:
~rk Estimated Estimated
Cost cc Material:; Cost cc
tion quantity total cost
i'1 16) (7'1
ly labour Ireport
Project: tather:
Date:
1. time
Daily equlpmer~treport
Project: Weather:
Date: Prepared bv:
- . - - . -
Equipmi tal hours tirnated

quipment Opera
No. )f work C(Et
(3)
Diesel
Petrol
:,.
Electricit
Such a detailed cost control programme specifies the areas that needs
attention. It requires substantial manpow~ e to
r produce and maintain. Oqe
~- -
rnay combine the basic and detailed cost control programmes judiciousk.
The detailed information may be made for the several key items and t i e
overall cost control may be done by the tbasic cost control method.
Cost Management 285
COST CODES
In all the tables (13.3,13.4 and 13.5),a column for the cost code is shown. In
a computerised accounting system, every individual accounting head is
assigned a code designation as a means of classification and identification.
In the present case, one is interested only for the job expenses account.
Coding c& be made in various alpha numeric forms that would suit the
particular requirement of the firm. As the standardisation has got a number
of advantages, efforts have been made to standardise the coding procedure.
One of the common coding procedure is advanced by the Construction
Specifications Institute of USA and is called MASTER FORMAT.^ A short
review of MASTERFORMAT is given below to illustrate a practical coding
procedure. A typical coding number in MASTERFORMAT may be
The first section 9203 identifies the project. The first two digit may indicate
that the contract was awarded on 1992. The next two digits may indicate that
the job is the third job awarded to the company in 1992. The next two sections
having five digits define the item of works according to the list shown in
broad scope and secondary divisions in MASTERFORMAT list, a portion of
which is presented in Appendix VI andVII. In this case, the digits 02 indicates
that it belongs to sitework and the digits 150 indicates that this is shoring
and under-pinning work. The next digit 3 is a company assigned distribution
code. For example, '1' is total, '2' is material, '3' is labour, '4' is equipment,
'5' is subcontract. Thus the digit 3 indicates that the cost belongs to labour
charges. Such a hierarchical coding system is essential to facilitate the
communication of information and proper aggregation of cost information
in various combinations.
SPECIAL ASPECTS OF EQUIPMENT CHARGE
In Tables 13.4 and 13.5, the estimated cost of the equipment are charged. The
unit, i.e. hourly rate of the equipment, is assumed to be known. In order to
derive the unit rate an equipment cost accounting is essential. In theory, the
equipment cost rate is
Rate =
1 -Z Purchase cost + Operating cost
Life of Equipment
+ Maintenance cost - Disposal value
In practice, none of the cost excepting the purchase cost can be estimated
with certainty. The accounting procedure to charge these costs vary from firm
to firm. For labour involving projects that employ a tiny fraction of total cost
of equipment, all equipment costs can be charged to overheads or a separate
equipment charge account. The average rate of a particular type of equip-
Table 13.4 Periodic cost report
Project: From/To:
Date: Prepared by:
Work done Materials cost Labour cost Equipment cost Total cost
2
3
3
5'
laole 13.5 Periodic cost comparlson (Q
Projec.
Date: Prepared by:
tal cost Savings/Loss
Wor
Cost code Item This Budget This period Actua1 to date
don Actual -
rorinrl
Loss Savings Loss
Cost Ma, ravcrrrcnt 287
ment used is shown in Tables 13.4 and 13.5. In developinl ies, the
equipment cost for most of the building and road building projects can be
accounted for in such a manner.
For equipment intensive projects, separate cost accounting systi
equipment may become necessary. The'cost of erection, dismantling, rcvalr
time, idle time, weather induced delay, etc. are recorded. The policy c an assist
in controlling under-usage of equipment. Standby equipments are somletimes
purposely kept at site to handle emergencies. A special account for
ment helps to promote the better management of the equiprnent.
Budget is an estimate of cost planned to be spent to ccmplete a particular

activity. For control and monitoring purposes, the detailed cost estimate is
generally converted to an initial budget. The budget is subsequently used as
a guide for planning. For a large project running over several years, the
budget is required to be updated to account for the change in price level and
in the scope of work.
In addition to cost, information on material quantities an(i labour inputs
within each job account is also shown in the project budget. .Actual mlaterial
and labour usage can be compared to the expected requirements. A itypical
budget for a small bridge is presented in Table 13.6.
Table 13.6 A typical budget
(Values are in thousands)
Material Sub-contract Temporary
-
Mi Total
Item
- - cost ccpst cost LU".
m
L.,<L
ct
1. Piling 600 120 0 55 775

2. Foundations 200 45 0 12 257
3. Retaining walls 250 52 68 0 370
4. Deck 900 183 121 62 1266
5. Finishing '120 37 10 0 167
6. Paving 60 21 0 31 112
7. Lighting 50 23 0 81
8.
. ..-
Others 20 12 0 32
2200 493 249 3060
Budget summary
Total direct cost
Indirect cost:
Mobilisation
Site office maintenance
Head office staff
Transportation
Total project cost
ACTIVITY COST CONTROL
Financial accounting typically records past expenditures. Since it is historical

in nature, some means of forecasting or projecting the future course of a
project is essential for management.contro1. An example of forecasting used '.
t o assess the project status is shown in Table 13.7. In the example, costs are
reported in five categories. Budgeted cost is derived from the detailed cost
estimate prepared during bid preparation or in the commencement of the
job. The estimated total cost is the current best estimate for the completion
of the activity. The current best estimate, i.e. estimated total cost, may differ
from budget for a number of reasons, namely inflation, inaccuracy in
estimates, ambiguity in specification or details of work, site conditions
unknown at the time of budget, unavoidable external factors like weather
and change in scope of work. The cost-to-date is the actual cost that has been
spent on the item till this date. The balance cost is the difference between the
estimated total cost and the cost-to-date. Over or under-budget is the
difference between the budgeted cost and the estimated total cost.
For the project cost control, the manager requires the information to focus
cost control on items that deviate substantially from the budgeted cost. In
tlie Table 13.7, the labour cost has increased to Rs 10,00,000/- from Rs
7,00,000/-, i.e. about 42%. A cost increase of such nature might be due to
lower productivity, higher wage rate, lower quality of work requiring repair
and rework, lack of tools or equipment, etc. The preparation of an item status
report is the first step to identify the problems. When the databases are
maintained in the computer, the graphic report illustrating the relationship
between the actual and budget expenditures as presented in Fig. 13.3 can be
conveniently prepared for management.
~ Table 13.7 Item status of R.C.C.

Estimated quantity: 3,000 cu. m Work done: 2,020 cu. m
(Amounts in thousands of rupees)
Budgeted Estimated Cost-to. Over
Factor
cost total cost date )r under)
Material 3100 3300
L,a bour 700 1000 625 3
Sub-contract 200 300 160 1
Others 100 100

Total 4501
Cost ~ a n a g e m e d 289
0
0
0
'R Forecast
expenditure
expenditure
25% 50% 75% 100%

Per cent of budget
expenditure
Fig. 13.3 Relation between the actual and the budget expenditure
FORECASTING OF COSTS
In addition to the control of project costs, the managers are responsible for
arranging funds for the continuation of the project.
f i e project schedule and the cost information derived in tables like 13.7
ar: combined to forecast the essential requirement of funds to achieve the
pr2gress according to the project schedule. An example blank is provided in
Table 13.8. The present work position is described in column 2. The future
quantum of work required to achieve progress according to the schedule is
shown in column 3. The difference between columns 3 and 2 is the planned
work volume and is presented in column 4. The present material cost
essential to achieve the progress mentioned in column 4 is estimated from
the tables like the one shown in Table 13.7. The cost of material at stock
shown in column 5 is deducted from the estimated material cost and the net
material cost is shown in column 7. The future estimated stock requirement
is shown in column 6. The remaining costs like labour and equipment are
estimated from the tables similar to the one shown in Table 13.4 and is
presented in columns 8,9 and 10. The total cost is the summation of column
6 to 10. The information from Table 13.8 provide a forecast of the fund
required to achieve the progress according to the schedule.
CASH FLOW CONTROL
Cost forecasting is the requirement of cost to continue with the project at the
desired speed. Cash flow control is the additional planning required to
Owners
Investment 11
Project
f-----
profit
Bank ---)Fund
Fig. 13.4 Flow of fund during progress
arrange for the cash to meet the demand for funds. The flow of fund during
the progress of the project is schematically shown in Fig. 13.4. Fund
requirements, i.e. payables in Fig. 13.4, is the aggregate summary of cost
forecast of individual items derived from the tables like the one presented
I in Table 13.8. The payables create products which in turn allow to raise bills.
I
I The billings are the inflow of cash to the project fund. The inflows to the
project fund also comes from the owners of the organisation as investment
and from the banks as loan. Cash flow control is the management of the.
system so that an optimum amount of cash remains in the project fund so
I as to continue the project at the planned speed. Reports are generated at a
periodic interval, say monthly, to monitor the cash position. An example of
I the cash flow report is presented in Table 13.9.
In Table 13.9, the projected costs shown in cell A1 and D l are collected
1 from the forecast of costs like the one presented in Table 13.8. The actual cost
shown in cell B1 are collected from the accounting data. The difference
between the actual and the projected cost presented in cell C1 provides an
idea of the accuracy of the estimate of the projected cost. The aggregate of
the actual cost incurred till date is presented as a cumulative cost in cell El.
Similarly, the actual and projected billings are recorded in column 2. The
difference between cell D l and D2 is the net projected cash flow for the next
non nth and is shown in cell D3. In case the net cash flow in cell D3 is negative,
the investment from the owners or a bank loan is required at the end of the
next month to meet the projected cost. The project planner is therefore able
to inform the owner or the banker in advance about the fund requirement.
The projected and actual investment from owners or loans from bankers
are shown in the appropriate columns in Table 13.9. The total investment by
Table 13.8 Monthly forecast of cost
Item
(1) (2) (3) (4)

2
Y
5
Lo
a
.+
2
(5)
..
32
;g
5 .f%
C4
(6)
-3.5
aJ w
2
E
FI
5E
Y
!j
.g
Labour Equipment.
cost
(8)
cost
(9)
Other
cost
(10)
Total
cost
(11)
1. Concrete cu. m
2. Shuttering sq. m
3. Brickwork cu.
T,able 13.9 Monthend cashflclw status report
-
-
Owners investment Bank
8h
c
-0
c -5 Expected
9 ;
Item .-0m .2 gross *
$3
8 2 5 YL
aJ
z' ti8
+
.- .- Lo
5 32 6
+
$ =
u b i j n
3 Inflo;.: Outflow Net Loan Interest
&e
%
g u d Profit LOSS
1 7 2 A C; A 7 8 9 1C) 11 17 12 lA
Projectec1 this mor

Actual tllis month
--
Differenc:e this mcn t h C

Projectec1 next month D
Actual till date E
C U ~ L ~ U ~ ~ L ~ V ~ !
the owner or the total interest paid for the project can thus be known to the
decision maker. The expected profit or loss column can be filled up from the
following relationship
El2/13=E3-El-E6-E7-E8+E9+ElO+Ell
The quantum of gross profit provides an idea for tax and a provision for
tax from the project fund that is shown in col. 9 can be made. The monthly
cash fund shown in cell Ell shall be positive and could be estimated from
the following relationship:
Dl1 = D 2 - D l + D 6 + D 7 > 0
The monthly cash flow status helps to identify the problem areas. A few
examples are provided in the following.
In civil (particularly for unit rate) contract, billing is a lengthy process. ,It
involves a recording of measurement, bill preparation, checking and pay-
ment. There is a time lag between the work done and bill passing. If the
billing section does not have the proper manpower, the time lag may
increase. In other words, the rate of progress in site may exceed the rate of
progress of bills. Under the circumstances, more and more company finance
gets involved in the project without any return. Table 13.9 normally identifies
tlie problem. If cell C1 remains small in a month, it indicates that the desired
amount of work is completed. If cell C2 for the next month does not exceed
cell C1 of this month more h d from the company is getting involved and
the planner generally looks for the problem mentioned above. If cell C3 is
persistently negative, the loss shows up in cell El3 and the remedial action
is required. In extreme cases like when cell D7 exceeds the loan limit imposed
by the bank, the work schedule may be slowed down which reduces cell Dl
to catch up the bill thereby increasing the cell E3 and E l l . Such a fine tuning
of cost and schedule can be planned with the cash flow status report.
The information from the cash flow status can be combined to obtain the
graphics as shown in Fig. 13.5 for the top management.
FUND FLOW
Fund flow is the movement of the fund, i.e. cash in an organisation. Closely
related to the projected fund-flow statements are the cash budget. It is
indispensable to the financial manager in determining the short-term cash
needs of the firm. Construction firms particularly the smaller ones are
perpetually strangled with the financial crunch. Cash budget is therefore a
very important exercise for most of the firms. When cash budgeting is
extended to include a range of possible outcomes, the financial manager can
evaluate the business risk and liquidity of the firm, and plan a more realistic
margin of safety.
Cost Management 293
Per cent of budget expenditure +

Fig. 13.5 Planned actual and revised expenditure
Finished goods Work-in-

inventory Depreciation
I
Taxes
expenses material
Overhead
Purchase of assets
Sale of assets
purchase
I I
Cash
Loan
Repayment
I Owners equity I I Debt I

Fig. 13.6 Fund flow cycle
The flow of fund in a firm may be visualised as a continuous cycle. A

typical fund flow cycle is presented in Fig. 13.6. Finished goods are produced
after a number pf inputs like material, 1abour ar eads all Iof which
require cash outflows. Cash inflows primar~lycome rrom tne sale or gooas
and owner's equity. The balance cash requirements are covered by debt
financing. The reservoir of cash fluctuates over time with production
schedule, sales, collection of receivables, capital expenditures and financing.
The purpose of fund flow statement or cash budget is to estimate the level
of available cash in the short term and plan accordingly. Examples of
expected cash flows for a hypothetical firm is shown in Table 13.10. In Table
13.10, expected cash flows for sales and expenses are estimated. The net cash
flow is determined and any short-fall is managed with the help of short-term
credits. Once the sales target and budgetc?d expenditures are estimelted with
the he:lp of marketing, production and accounting, data aIre used to fill up
the Tal)le13.10 and are informed to the resipective clepartments and cIivisions.
They are encouraged to adhere to the buclgeted schedule. 1h u s the I
if any of the fund can be managed effect:ively.
Table 13-10 Fxnected scheou~esor casn rlomIS
(Values are in thc
U'CJ I\CLC'f,LJ
:redit Sales
1. Initial
2. Collection in mcinth 1
3. Collection'in mc
4. Cash s;ale
-1, ,:
,
,
5. Total sale: L-CI~
xpenses
:redit purl
1. Initial
2. Payment after n
3. Payment after n
4. Cash payment
5. Wages
6. Other overhead
7. Capital investm
8. Divide?nd payment
9. Loan Iepaymen t
0. Income taxes
1. Total expenses
:ash Balailce
1. Net cash flow
2. B e ~ n n i .n,gcash
5 cash
4. Financ:ing requirements

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CONSTRUCTION MANAGEMENT

Tata McGraw-Hill Publishing Company Limited

IlrbVl Hill OfficnC

9 9 5 , Tata ishing Cotnpany L'ir

Six1th reprint 2002

is publicaltion can be reprodulced in an)r form or by any ml

Thits edition (:an be exr)orted frotn India 01ily by the publisher

Pubdished by Tata McGraw-Hill Publishing : Compan:y Limited,

Calcutta-700 001, with a self-addr imped er 'or a list of such

to our fiamilies fc3r their cor, ;tart tmcourag rt the shaping of

ew years back, a senior executive of Ta Publishi

The Construction Industry 1

7. CONSTRUCTION PRACTICE 11: SUPEI CTURE

8. TIMES MAINALEMLN1 A N U XHLL)ULING

9. QIJANTITATIVE MA NAGEM 'ONS

RESOURCE MANAGEMENT AND I:

Ratio Analysis 257

13. CO!ST MANAGEMENT

Cash Flow Control 289

Payment of Bonus Act, 1965 383

17. CASE STUDY

19. SELECTED RESEARCH TOPICS nV CONS

THE CONSTRUCTION INDUSTRY

The construction i y is one of the oldest and largest industries.

TYPES OF CONSTRUCTION-PUBLIC AND PF

select the appropriate contractors. $

encouraged is a matter of policy of the ruling gcwernmerit and this policy

Civil engineering construction needs the

body such as a local government authority or a gove!rnment clepartrnent, a

The consultant/engineer or architect is a person or a group of persons or a

develop full confidence on him. He must be well-trained in quality and

2. He may engage one competent engineer from his own employment

in the contract signed by him.

General laws/regulations Specific

Labour and Financial Commercial

Fig. 1.1 Catec

Table 1.1 Construction share of five year plans

Even with this emphasis in national planning, construction requires more

non-reporting sectors, and 67 lakhs of seasonal workei rork only,p

Table 1.2 Investment in gross domestic product, GDP (19e

It is surprising that despite its massive size, the ce t has

to bank finance and other economic benefits. There is no comprehensive act

FEATURES OF CONSTRUCTION ECONOMY

From an economist's point of view, construction is a service which has a

I Market for real estate

Fig. 1.2 Economic context of construction

and solutions in the construction economy.

of the industry generally create favourable conditions for the establishment

In U.S.A., the number of construction firms exceed one milliion. How'ever,

ROLE OF CONSTRUCTION MANAGEMEN'

hampered. This "mdst s ic manne ires adop

nowadays for the management - of the projects. The use of plant a n c

Why is COI I classifiedI as an indlustry? Hc>ware the quality o f construc

What are the differ1ent ways of engagi~ &ant? WI at are mf

contract betweenI two or ties for 4 :ts to

~bwithin the scheduled time, following drawings, designs, specifica~tions

ivil en* ontracts 'ally of t~

1. Contract at a Fixed PI'ice

, Contract other than Fi]

Contract at a fixed price may be divided as follows: bill of quantities

Bill of Quantities Contract

Schedule of Rzrte Cont~

There a re some jobs where it becomes difficult to 7irisualise the quar