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PGPM 32_NICMAR Assignments

PGPM 32_NICMAR Assignments

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Published by: Vinod Vasan on Aug 02, 2012
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1. Course No. 2. Course title 3. Assignment No. 4. Date of Dispatch

: : : :

PGPM 32 Management Information System 10 07-08-2012 15-08-2012

5. Last Date of receipt : of Assignment at CODE office

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

SCOPE OF WORK The work involves four main works i.e. Main Dam, weir, Electric power station and Tunnel. The above work involves Supply, transportation, unloading, fabrication, erection, testing and commissioning of balance ventilation ducts and equipments as per technical specifications. Benefits of Hydro Power: Energy has become a symbol of growth and instrument for development. Electric power particularly the hydro power is a renewable, economically attractive, environment friendly, nonpolluting and environmentally benign source of energy. Moreover, the Hydro Power is submergence free and has short gestation period. These benefits of HP have now been sufficiently recognized. The need of the project comes from the benefits of HP and utilization of resources. Management information system provides predefined types of information to the management for relatively structured type of decisions. Management Information System (M.I.S) design for Hydel-Power Project is very much limited to a specific area as all the material and data is to be managed on the site for the given requirement. Now the requirements for the hydel project are entirely different from general construction sites.  The height of the control room shall be higher as compared, so as to take care of the heat generated from the electrical panels and the control of all the panels can be made on the mezzanine level which saves the space and offers the wider view of the area underneath.  The substation part has to be made in the open area and the wiring of the towers is taken care by the R.C.C. Trenches made under the floor.  From the reservoirs the water is brought through a tunnel for the generation of the electricity. i.e. In itself a very technical and specific requirement for the construction of the project. As far as the scope of the hydel projects is concerned it is not as limited because of the fact that our country is facing shortage of electricity. In future we shall need more of hydel projects to meet the requisite demands of the power sector and of course to facilitate the people staying in the remotest areas of the country. This is the reason in the recent years even World Bank has offered to finance the hydel projects in states like Himachala Pradesh, utaranchal, Assam & jammu Kashmir.

MATERIALS MANAGEMENT ORGANISATION Material management can thus be defined as that aspect of management Function which is primarily concerned with the acquisition, control and use of materials needed and flow of goods and services connected with production or construction process into and within an organization. The modern concept of Materials Management integrates the entire range of functions which effect the flow, conservation and utilization of all materials and brings together the activities such as materials planning and budgeting, purchasing, inventory control, clearing and forwarding, receiving and storekeeping, materials handling, salvaging, scrap and surplus disposal, value analysis and materials standardization. The significance of this concept lies in the fact that efficiency of any organization is depend upon having the : “Right Material of the Right Quality at the Right Price in the Right Quantity at the Right Time and Place “ The management of the various materials required at site shall be organized at different levels.  Upper Level To determine the goals, objectives & plans.  Ability to deal with the ambiguities of the decisions taken.  Middle Level Determination of the ways to construction done in time schedule. To check how much money has been incurred till the specific date.  Lower Level Control the activities of the workers to meet the targets. The materials required for the hydel projects shall be managed according to the levels mentioned above.

Here I take the example of a hydel project of 5MW capacity. Requirement for the project is as follows:  Control Room with a covered area of 14,000sqft. o Outer walls in brick o Frame work of RCC Columns and Beams o Asbestos sheets as roofing o Concrete floor with separators o Steel windows and doors o Tie beams at the regular intervals to prevent Earthquake.  66KVA grid station in the open area  Office Spaces  Site Offices as temporary structures  Material Storage Areas  Water Reservoir  Accommodation for staff Material requirement for the project:  Cement  Steel  Aggregate  Sand  Bricks 2200 bags approx. 40 Tonnes approx. 12,000 cft approx. 8,500 cft approx. 1,80,000 no.

Stage 1 : From foundation level to plinth level  Cement : 600 bags  Sand:  Aggregate:  Steel:  Bricks: 3500 CFT 2500 cft. 12 tones of 25mm , 20mm  & 8mm  20,000 bricks in no.

Stage 2 : Up to lintel level  Cement : 500 bags  Sand:  Aggregate:  Steel:  Bricks: 2500 CFT 3500 cft. 07 tones of 25mm , 20mm , 16mm  & 8mm  50,000 bricks in no.

Stage 3 : On laying of slabs  Cement: 700 bags  Sand:  Aggregate:  Steel:  Bricks: 3000 CFT 5000 cft. 8 tones of 25mm , 20mm ,16mm  & 8mm  80,000 bricks in no.

Remaining quantity of the materials shall be ordered on the requirement of the miscellaneous activities like plastering, brick soling and brick ballast, etc.

INVENTORY CONTROL MEASURES The aim of the materials management is to make available the right type of material in right quantity, at the right price, at the right time and at the right place. The objective is such that the construction work should not beheld up for the want of material but the total investment on the materials minimum. If we examine the aims and objectives very carefully the concept of Inventory control in the material management is obvious. This can be considered as a very important function of materials management. It is mainly concerned with laying the policies regarding how much quantity of a material should be held in stock so that the aim of the material management of ensuring continuity of the project with the minimum investment in materials is fulfilled. Inventory are necessary because they provide protection against uncertainty of demand and supply. 1. They ensure smooth flow of materials through production process. 2. They ensure reasonable utilization of manpower and equipment etc.,& 3. They also provide the means to maintain good customer service. TWO-BIN System Inspired by the kanban replenishment method developed and made popular in Japan, this replenishment system, adapted to hospital supplies, is based on the principle of two bins for each product type. Each bin contains half of the quota (inventory level) for a given product. A bar code label is affixed to the front of each bin. When the first bin is empty, user personnel or clerical staff transfers the label to a board mounted on the wall, and supplies are used from the second bin. Using an optical scanner and according to a pre-determined schedule, a stores employee scans the labels on the board to capture data on the products requiring replenishment, which in turn triggers the process to replenish the quantity contained in the bin. This activity can be eliminated through the use of a replenishment software application that uses RFID technology. This application is presented in the section “RFID-assisted replenishment”. Once the person responsible for managing inventory in the department has replenished the bin, he or she first transfers the remaining supplies in the second bin to the first bin, then places the new supplies in the now empty second bin, returning the label to the front of the first bin. In this way, stock rotation occurs with each replenishment. This system simplifies the needs evaluation process. When compared with other recurring replenishment methods, the two-bin system stands apart. It requires no inventory taking (or verification) prior to scanning the labels. It also facilitates stock rotation management, which is essential to prevent product expiry, and it significantly improves the control of stock levels.

EOQ: Economic order quantity (also known as the Wilson EOQ Model or simply the EOQ Model) is a model that defines the optimal quantity to order that minimizes total variable costs required to order and hold inventory. It is based on the assumptions: 1) The demand over the period of cycle (normally a year) is constant and is known in advance. 2) Consumption of the material occurs at the uniform rate. 3) The price of the material is independent of the order. Quantity discount is not allowed 4) There is no lead time in the replenishment. We should know Ordering cost and Carrying cost A) Ordering Cost: consists of i) Requisitioning ii) Order processing iii) Order placing, and iv) Receiving, inspection, checking etc. B) Carrying Cost: i) Interest on Capital invested ii) Storage, handling and warehousing such as rent, Insurances and taxes, Lighting, and other maintenance costs Right purchase quantity should ensure that overall cost of acquisition and possession is minimum, while holding the optimum quantity of an item in inventory. It will have to be appreciated that a point of minimum cost is reached at which the ordering cost will be just equal to the carrying cost such that neither excess material is ordered nor too many orders are frequently placed for the same material during a time period, for which demand pattern is more or less known. It must be remembered, however, that while the former varies with the number of orders placed, the latter is linearly and directly related to the quantity carried into the inventory.

EOQ MODEL ROL: The two factors that determine the appropriate order point are the procurement or delivery time stock which is the Inventory needed during the lead time (i.e., the difference between the order date and the receipt of the inventory ordered) and the safety stock which is the minimum level of inventory that is held as a protection against shortages. Reorder Point = Normal consumption during lead-time + Safety Stock. Several factors determine how much delivery time stock and safety stock should be held. In summary, the efficiency of a replenishment system affects how much delivery time is needed. Since the delivery time stock is the expected inventory usage between ordering and receiving inventory, efficient replenishment of inventory would reduce the need for delivery time stock. And the determination of level of safety stock involves a basic trade-off between the risk of stock-out, resulting in possible customer dissatisfaction and lost sales, and the increased costs associated with carrying additional inventory REORDER POINT FORMULA: Reorder point = S x L + F ( S x Rx L) Where S = Usage in units L = Lead time in days R = Average number of units per order F = Stock out acceptance factor

SITE STORAGE AND REPORTING Materials to be stored are in the following way: Steel & Cement Aggregate, Sand in a room with an area of 14,000sqft. in open courtyard

Reporting: Scheduled Reports: I would make the scheduled reports which would be issued fortnightly. The reports would be containing the details of production, monthly cash flow etc. for further use in planning and control processes. Error Reports: I would make these reports to correct the invalid customer names, incorrect totals and missing data during transaction. Control Reports: Control reports would be maintained in the form of payroll register, a journal, a cash register etc. giving detailed listing to describe each transaction occurring during a specific time period. Provision for Exception reports & Demand reports would be there.

INTEGRATED REPORTING SYSTEM Basically an integrated reporting is the system in which can get information from all the reports at lower level. Specific to this project reports from labour class to S.E.’s etc. would be base for integrated reporting for the next level. SYSTEM DEVELOPMENT: following the following steps: Own staff Staff of outside agencies Separate files for different applications Work done by own staff Billing for various activities Work done by outside staff  Integration of related files of various activities:  Relationship between different entities:    One to one One to many Many to many Files shall be made in Excel programme For the system development of the hydel project we shall be

for the separate jobs to be done in a stipulated period and the manpower involved. different entity relationships are as follows

In the management system of hydel project we shall create files showing one specific activity is to be done by one agency e.g. the completion of superstructure shall be done by a construction agency. This construction agency shall be assigned more than one job. Here “One to many” type of relationship between different entities shall be helpful.

DATA PROCESSING: Activity Civil work Finishing Agency P1 P2 Duration 2yrs 3 Months 6Months Cost ……..Lacs ……..Lacs

FLOW CHARTING: Flow charts of the various jobs/activities shall be made on the weekly basis, checking the commitment by the agency for that specific job. If any activity is not completed in the specified time it will have to be overlapped in the second week assuming it to be the responsibility of the concerned agency. After the 6th week if the same situation prevails for the delayed activity penalty clause will be applicable as per the agreement. The employer and the outside agency shall sign this agreement. This flowchart shall be made using the P.C. software MRPII System(Material Resource Planning) and shall make it very easy to maintain the records of agencies hired and the jobs done by them. Activity A1 A2 A3 1st week 2nd week 3rd week 4th week 5th week

COMPUTER APPLICATIONS Data Communication, file design: As per the data file enclosed below. System design specifications: The MIS specifications were designed with 40GB hard disc, 512Mb RAM, P4 & MS-Office as software. System analysis and design: As I have already discussed the MIS design for the hydel project with the system design specifications already mentioned. The whole project has been divided into construction segments. The data file for the different activities has already been attached with. As per my design all the activities e.g. requirement of the materials, their consumption, the duration of the activities, the manpower required has been segregated so as to avoid all confusions regarding the cost factor and consumption of materials. I have designed the specifications for the contractors and other outside agencies as well e.g. the time schedule of the work they will handle and the penalty clauses, if applicable. I have designed my specifications of the materials stage wise. This will avoid any type of pilferage during the construction tenure of the project. To the maximum I have tried in my design not to have excess storage of the materials as this leads to the wastage of materials like cement (because of its setting action), steel (rusting of steel) after the handing over of the project. In totality I conclude that my MIS design for the project is completely successful.

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