International Journal of Construction Management

ISSN: 1562-3599 (Print) 2331-2327 (Online) Journal homepage: https://www.tandfonline.com/loi/tjcm20

Developing an optimization financing cost-

scheduling trade-off model in construction project

Mehdi Tavakolan & Shayan Nikoukar

To cite this article: Mehdi Tavakolan & Shayan Nikoukar (2019): Developing an optimization
financing cost-scheduling trade-off model in construction project, International Journal of
Construction Management, DOI: 10.1080/15623599.2019.1619439

To link to this article: https://doi.org/10.1080/15623599.2019.1619439

Published online: 20 Aug 2019.

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INTERNATIONAL JOURNAL OF CONSTRUCTION MANAGEMENT
https://doi.org/10.1080/15623599.2019.1619439

Developing an optimization financing cost-scheduling trade-off model in

construction project
Mehdi Tavakolan and Shayan Nikoukar
Department of Construction Engineering and Management, School of Civil Engineering, College of Engineering, University of Tehran,
Tehran, Iran

ABSTRACT KEYWORDS
Time-cost trade-off analysis is one of the most challenging tasks of construction project plan- Financing cost; hybrid
ners. Project planners face complicated multivariate time-cost optimization problems that meta-heuristic algorithm;
require simultaneous minimization of total project duration and total project cost while consid- cash flow; scheduling;
multi-objective optimiza-
ering issues related to the optimal present value of profit. In addition, given the complexity of tion; large-scale project
construction projects in recent years, clever management has become increasingly important in
cases of project financing and scheduling. There are choices and limits that make it difficult for
project planners to develop a proper financing plan considering project time status. Therefore,
the methods of financing affect the project plan. Parameters such as interest rate, contract
terms, and financing options (i.e., types of the loan) in the project construction period can
change the final profit value of the project. Hence, a skilled planner should consider various
effective parameters for scheduling projects. This study presents a hybrid meta-heuristic algo-
rithm to solve a multi-objective optimization problem in construction project planning and
financing. The main objective of the model is to present a Pareto chart that shows the trade-off
between duration of the project and the financing cost by considering different durations for
each activity of the project and various financing options. The model is first validated in a sim-
ple case study and then applied to a large-scale case study. The model shows the optimal solu-
tions which have time and financing cost. For each optimal solution, the model will create a
cash flow containing project (direct and indirect cost and payments) and financing flows (bor-
rowed money and repayments of principal and interest) based on a work schedule. Finally, a
sensitivity analysis is performed to examine the effects of changes in the various parameters of
the project cash flow on the ultimate results. It is shown that the proposed model is superior to
the existing models in finding better project planning solutions with lower total project duration
and lower total project financing cost in the proposed construction project financing problems.
In addition, the proposed model improves the solutions through generations and provides opti-
mal solutions in acceptable processing time.

Introduction
Widespread adoption and complexity of new-fash-
ioned construction projects needs intense manage-
ment. The necessity to reduce both the cost and
execution duration of a project is one of the most
important roles of contractors (Ng and Zhang 2008).
The allocation of budget and project finance is a vital
aspect of construction projects. Ignoring this issue
can lead to losses to contractors (Liu and Wang
2010). Instead, efficient management of financing
projects will have benefits for contractors. High level
of uncertainty within the construction industry results
in the bankruptcy of many contractors every year.
This happens mainly because of financial reasons.
The lack of finance causes 77–95% of contractor
failures (Russell 1991). In this light, contractors need
to provide appropriate funding with a variety of
methods (i.e., bank loans) to finance the pro-
ject properly.
The method of financing may give the contractors
insurance that at any periods of the project, their
liability will not exceed the limits of credibility
(Elazouni and Metwally 2007). Additionally, ignoring
financing along project scheduling affects the cash
flow making the schedules infeasible, which results in
contractors facing a high rate of failure (Alavipour
and Arditi 2018). Financing problems may affect rela-
tions among project stakeholders such as conflicts
promotion (Harmon 2003), occurrence of the claim
(Arditi and Pattanakitchamroon 2008) and increasing

CONTACT Mehdi Tavakolan mtavakolan@ut.ac.ir

ß 2019 Informa UK Limited, trading as Taylor & Francis Group
2 M. TAVAKOLAN AND S. NIKOUKAR
of contract failures (Russell 1991) and it also may
have an influence on the cash flow of the project.
Therefore, integration of financing and scheduling is
essential for minimizing and managing project
expenses. Recently, financing problems have become
more essential in project management. In order to
optimize objectives such as financing cost, profit, time
and cost, decision-makers need to analyze and select
the best executive and financing method for each
activity. Many project planners need to reduce project
financing cost and increase the profit of the project to
be successful in the project while simultaneously
choosing a schedule that has the minimum duration.
In some real projects, various methods are applied
and the results are significantly suitable, but these
methods may suffer from a large amount of process-
ing time to reach optimum answers. A full review of
related studies, including their corresponding back-
ground and solutions, are discussed in the follow-
ing section.
Literature review
Over the past 25 years, many studies have been done
in the field of optimization. Problems such as time-
cost trade-off (Zheng et al. 2004), procurement sched-
uling (Dixit et al. 2018), real-time schedule estimation
(Pareek et al. 2016), economic optimization of con-
struction project scheduling (Karshenas and Haber
2006), resource leveling (Kandil and El-Rayes 2006),
resource allocation (Valls et al. 2008) or a combination
of the mentioned problems (i.e. integration of both
resource leveling and allocation by Leu and Yang
1999, and reducing time and resource-constrained
with simulation modelling by Ahmed et al. 2018) have
been investigated. To solve optimization problems,
various techniques have been presented. These meth-
ods can be categorized into three main areas: (1)
mathematical methods, (2) heuristic methods and (3)
meta-heuristic methods.
(1) Mathematical methods change the problem to
standard mathematical programming models and
then try to reach the optimal solution of the problem
with the use of linear, integer, or dynamic program-
ming (Ammar 2005). Kelley Jr (1961), Hendrickson
and Au (1989) and Pagnoni (2012) used mathematical
methods to obtain the finest solution in their opti-
mization problems.
(2) Due to the high computation time required by
mathematical methods to evaluate all possible solu-
tions, Heuristic methods have instead been promoted.
These methods are founded on rules of thumb and
lack mathematical exactitude (El-Abbasy et al. 2012).
Fondahl’s method (Fondahl 1962), Prager’s structural
model (Prager 1963) and Moselhi’s structural stiffness
method (Moselhi 1993) are good examples of heuris-
tic methods.
(3) Despite providing fairly good solutions, heur-
istic methods do not contain the full range of pos-
sible solutions. So, meta-heuristic methods were
introduced to improve the quality of solutions. An
algorithm was developed by El-Rayes and Moselhi
(1998) to solve resource-driven scheduling of repeti-
tive activities. Some research employed Genetic
Algorithms (GAs) for solving resource allocation and
leveling problem at the same time (Hegazy 1999;
Chan et al. 1996; El-Rayes and Jun 2009). Also, a
GA and Pareto front sorting was utilized by Eid
et al. (2018) to develop a simultaneous multi-criteria
optimization approach in order to solve linear infra-
structure projects scheduling problem. The shuffled
frog-leaping algorithm is introduced by Eusuff and
Lansey (2003) in order to solve complex optimiza-
tion problems in water resource planning area. In
this algorithm, the population (a set of frogs) is div-
ided into subsets which are called memeplexes. In
each memeplex a local search inspired by the social
behavior-based PSO algorithm is done and the shuf-
fling process then occurs (Elbeltagi et al. 2005).
Ashuri and Tavakolan (2013) presented a shuffled
frog-leaping model for solving time-cost-resource
optimization problems in construction pro-
ject planning.
Hybrid and improved meta-heuristic algorithms
are used to increase the convergence rate and qual-
ity of the solutions, especially in complex problems
that may contain many activities. Improved algo-
rithms are the algorithms which have some changes
in their operators. Shadrokh and Kianfar (2007)
introduced a twofold chromosome. Abido and
Elazouni (2011) presented precedence-preserving
crossover and mutation operators. Alghazi et al.
(2013) initiated a chromosome repair and penalty
mechanism in GA for solving the finance-based
scheduling problem. Hybrid algorithms may contain
at least two algorithms (usually one algorithm is
used as a foundation of the hybrid algorithm).
Study on hybrid algorithm can be summarized in
some researches such as hybrid GA of Hossein
Hashemi Doulabi et al. (2011), hybrid GA and SA
model of Sonmez and Bettemir (2012), and merged
GA, SA and backward-forward scheduling model of
Sonmez and Uysal (2015). Recently, Luong et al.
(2018) presented a novel optimization model

(Opposition-based Multiple Objective Differential
Evolution) to solve the time-cost-quality a trade-
off problem.
Time-cost trade-off (TCTO) problem is one of the
first issues raised in optimization problems. It was
introduced by Hindelang and Muth (1979) for the
first time. After that, many researchers have estab-
lished their studies on TCTO problems. Khalafallah
and Abdel-Raheem (2011) introduced a new meta-
heuristic algorithm called ‘Electimize’ which was cap-
able of calculating solutions with proper quality. They
used Electimize to solve TCTO problem. Other
researches in TCTO area are the Yang et al. (2007)
study which used a modified particle swarm optimiza-
tion to solve the problem, the Zheng and Ng (2005)
fuzzy model, and the Sonmez and Bettemir (2012)
complex case study.
In addition to time and cost variables, cash flow is
one of the challenging variables in literature because
of its distinctive feature that cash is being used analo-
gous to any resource to advance work and after com-
pleting the effort, it is generated from the work to
finance remaining activities (El-Abbasy et al. 2012).
Elazouni and Gab-Allah (2004) originated the
finance-based scheduling to solve cash flow problems.
They applied their model to determine a feasible
schedule that simultaneously minimizes project delay
and financing cost when a cash constraint exists.
Elazouni also carried out a few studies in the area of
cash flow and profit of project (Elazouni and
Metwally 2005; Elazouni and Metwally 2007; Ali and
Elazouni 2009; Abido and Elazouni 2010; Elazouni
and Abido 2011; Gajpal and Elazouni 2015).
Similarly, Park (2004) applied GA on finance-based
multi-objective optimization construction problem
and forecasted cash flow in a construction project in
two different studies. Recently, Ock and Park (2016)
have used an algorithm to forecast cash flow in the
planning stage of a practical construction project.
Moreover, Alavipour and Arditi (2018) proposed a
model to minimize financing cost by considering dif-
ferent financing options in a common CPM
work schedule.
Although there are significant improvements in the
solutions of the aforementioned categories of opti-
mization problems, there are rarely studies that com-
bine the stated categories to actualize the problems
and its solutions. This matter can be a suitable back-
ground for optimizing financing cost and scheduling
of complex project and solving it with a fast and
acceptable method.
INTERNATIONAL JOURNAL OF CONSTRUCTION MANAGEMENT 3
Research contribution
The existing cash flow optimization models have
some shortages: (1) none of them have considered
profit value as an independent parameter to the cost
and time of the project. (2) Although there are several
financing methods (i.e., times of cash provisions,
interest rates, and repayment options), most of the
mentioned studies have applied only a credit line as a
source of financing. (3) All pertinent studies con-
ducted so far have used direct cost only for activity
progress where material can be linked to a different
procurement plan. (4) Almost all previous studies
except the one conducted by Alavipour and Arditi
(2018) shifted the start time of activities within its
total float in order to minimize financing cost, but
these models may result in a more critical work
schedule. (5) None of the finance-based studies have
considered different finance costs with different pro-
ject durations concurrently. None of the finance-based
models combined a detailed financing schedule (bor-
rowing and repaying money including interest) with a
comprehensive construction plan for the purpose of
developing more realistic optimization problems. The
main contribution of this paper is to optimize the
financing cost of the project allowing for a shift in
the duration of activities based on changes in resource
utilization.
In this study, a multi-objective model that simul-
taneously optimizes financing cost and duration of
two case studies is developed. A hybrid SFL-GA algo-
rithm is used to solve the problems. The proposed
optimization model has two objective functions. This
includes minimizing total project time and summa-
tion of interests of repaid money that are borrowed
with different methods in order to prevent the cash
flow from falling down below the specified limit of
liquidity. The time and cost of each activity is also
considered to be dynamic in an indicated range and
in a discrete space, which represents different options
of activities. In each calculated duration of the pro-
ject, the minimum total financing cost and the min-
imum net present value of profit are computed and
the results are shown in a two-dimensional Pareto
chart. A sensitivity analysis is then performed to dem-
onstrate the sensibility of various project parameters
(i.e., advanced payment, advance payment percentage
of pay requests, lag in paying payment requests, etc.).
The process of developing the model is categorized
into two main stages. In the first stage, model param-
eters are defined and in the second stage, the solving
algorithm is presented. In the following sections, both
stages are described in details.
4 M. TAVAKOLAN AND S. NIKOUKAR
Research methodology
Model parameters
Project schedule and activity relationship
The critical path method (CPM) is an algorithm for
scheduling a set of project activities. The start and
finish times of activities are the basis of cash flow.
CPM determines the early start, early finish, late start
and late finish of activities. Formulation of this article
schedule model is acquired from the Liu and Wang
(2010). It supposes that only Finish-to-Start relation
connects the activities. This relationship which is
shown in Equation (1), illustrates the logic among
start date of activity, duration of activity, and finish
date of activity. Also, the earliest start date of each
activity is maximum of the finish date of its predeces-
sors. Equation 2 presents the relationship between the
earliest start date and the predecessors of an activity.
Si þ di ¼ Fi (1)
Si ¼ max fFpi g i ¼ 1; 2; . . . ; n; (2)
8i
In Equations (1) and (2), Si represents the start
date of activity i; Fi is the finish date of activity i; di
states the duration of activity i; Pi denotes the prede-
cessors of the activity i; FPi is the finish date of prede-
cessors of activity i and n is number of activities in
the project.
Cost estimation
The total cost of a project comprises of direct cost
and indirect cost. Also, financing cost can be added
to the calculation of total cost of a project. The total
direct cost which is composed of materials, labor,
equipment, and subcontractors (Fathi and Afshar
2010) is calculated by the sum of weekly direct costs
(Equation 3), where is the project duration expressed
in weeks (the time unit of activity duration) and com-
puted from CPM algorithm.
Xn
DC ¼ i¼1
dci (3)
In contrast to direct cost, indirect cost of a project
includes more parameters like fixed overhead, variable
overhead (Fathi and Afshar 2010), and mobilization
and bonding costs. Fixed overhead made from the
organization and administrative expenses, generally
remains constant over the duration of a project
(Clough et al. 2015). For example, the rent of the
office as a fixed overhead cost (CFO ) does not change
during the unbalanced progress of the project
(Peterson 2013). CFO of a project is calculated by mul-
tiplying the CFO per week (OF ) with the number of
weeks to complete the project (n) as follows:
CFO ¼ OF  n (4)
Another overhead cost called Variable overhead
includes utility costs on the job site, staff and man-
agement costs, taxes, insurances, and etc. (Fathi and
Afshar 2010). Unlike the CFO ; variable overhead cost
(CVO ) tends to vary with the volume of work per-
formed (Peterson 2013). Despite aggregation of fixed
and variable overhead cost by some previous studies
(e.g., Ali and Elazouni 2009; Elazouni and Metwally
2007; Liu and Wang 2008) CVO is separately calcu-
lated by multiplying the weekly direct cost (DCi ) with
a percentage (Ov) based on the historical documents
of organization (Fathi and Afshar 2010). Equation (5)
presents the calculation of CVO :
Xn
CVO ¼ O  DCi
i¼1 V
(5)
Mobilization cost is associated with those costs that
are vital for project equipment, supplies, personnel,
machinery, and facilities needed to prepare the project
beginning on the job site. The mobilization cost (CM ) is
considered as a percentage (OM ) of (direct cost þ vari-
able overhead cost) which is shown in Equation (6):
CM ¼ OM  ðDC þ CVO Þ (6)
Equation (7) illustrates the calculation of the
markup (CMP ):
CMP ¼ OMP  ðDC þ CVO þ CFO þ CM Þ (7)
After knowing the total project cost, (direct cost,
indirect cost and markup) the bonding cost can be
calculated. The contractor pays the premium (OB )
expressed as a percentage for the bond which varies
from 0.5 to 2% (Clough et al. 2015). Therefore, the
bonding cost (CB ) is computed by using Equation (8):
CB ¼ OB  ðDC þ CVO þ CFO þ CM þ CMP Þ (8)
The sum of the direct cost, the fixed and variable
overheads, the mobilization cost, the cost of bonding,
and the markup is equal to the contract bid price
(CBP ) (Equation 9).
CBP ¼ DC þ CVO þ CFO þ CM þ CMP þ CB (9)
Cash flow model
Au and Hendrickson (1986) presented a model of
contractor’s cash inflows and outflows. These compo-
nents were charted at ends of periods which could be
weeks or months (Elazouni and Metwally 2007).
Contractors need to build project cash flow according
to their credit line accounts. The model is inspired by

the cash flow model of Elazouni and Metwally (2005)
and it contains a variety of cash outflows and inflows.
As the project starts and proceeds with time, cash
inflows will be added to the model and cash outflows
will be subtracted from the model at due times. In
this article, it is assumed that the contract is a lump
sum. So the progress payments are through calculat-
ing the worth of work items based on the unit prices.
These payments are usually made on a monthly basis
(Hinze 2012). Generally, after the contractor has
requested payment at the end of each month, the
owner deducts the retainage and pays the remainder
to the contractor 1 month or more after the payment
request has been submitted. An advance payment is a
type of payment that is made ahead of its normal
schedule. This is common in construction projects
where the owner pays a percentage (OAP ) of contract
bid price at the start of the project which is located at
time of zero in the cash flow. Moreover, the final pay-
ment is settled about 1–3 months after the last pay-
ment request submission (Hinze 2012). This payment
includes the release of the retainage. This article
assumes that the contractor regularly submits a pay
request every month. Therefore, t is the time when
the payment requests are submitted (at the end of the
month). Subsequently, (t þ Lp ) is the time when the
payment is made by the owner where Lp is the lag
time expressed as months which the owner needs to
analyze and respond to the request. Equation (10)
shows the progress payment at the end of each period
(t þ Lp ) denoted by PtþLp :
 
CBP X4t
PtþLp ¼ ð1RÞ   i¼ð4t Þ3
DCi
DC
(10)
ðOAP  CBP Þ
 ; t ¼ 1; 2; . . . ; n
n and the interest can be paid monthly or compounded
where R is a retained percentage of payment requests,
and n is total duration of the project.
Also, the final payment (PtþLR ) is calculated by
using Equation (11), where the lag time to respond
the ending request is indicated by LR which is differ-
ent with Lp :
PtþLR ¼ ½R  CBP ; t ¼ n þ Lp (11)
As discussed in this section, cash inflows are pay-
ments of the owner to the contractor based on the
work progress during the project. On the other hand,
cash outflows are the expenses of the contractor dis-
bursed at the end of a typical project period.
Equation (12) formulates the disbursement (Dt ) of the
contractor at the end of period t (expressed as
months).
INTERNATIONAL JOURNAL OF CONSTRUCTION MANAGEMENT 5

C þ CB
PM4t t¼0
Dt ¼
ð4t Þ3 ðDCi þ OF þ CVOi Þ t ¼ 1; 2; . . . ; n
(12)
At time of zero, there are two expenses that are
mobilization and bonding cost. As the project begins,
at the end of month t; the contractor calculates the
sum of weekly direct cost, weekly fixed overhead, and
weekly variable overhead for the last four weeks to
submit the payment request to the owner. It should
be noted that to calculate the cash outflows and
inflows, several parameters,OAP ;R; Lp ; LR ; OF ; OV ;
OM ; OMP and OB ; should be input through the user.
Financing the project
In this article, three categories of financing with several
alternatives in each category is applied to the cash flow
model. These categories inspired by the study of
Alavipour and Arditi (2018) are short-term loans, a
long-term loan, and a line of credit. This financing
model considers almost all possible offers by lenders.
Although there are a variety of repayment schedules for
paying back loans to lenders, in this study paying back
is considered monthly for long-term loans and 3, 6, 9
or 12 months after borrowing the funds for short-term
loans. Short-term loans can be taken either monthly or
quarterly while the long-term loan is taken once at the
beginning of the project. For the repayment of the
loans, there is a difference between short-term and
long-term loans. For the long-term case, both the prin-
cipal and interest are repaid monthly with a fixed
amount. However, repayment of the short-term loan is
such that the principal is paid off after a specific time
(e.g., 3, 6, 9 or 12 months after the time of borrowing)
over a specified time.
In contrast to short-term loans, the total credit
withdrawn from a line of credit can be reused as long
as the contractor pays back his/her debts periodically.
Each month the contractor can withdraw money, con-
sidering its limitation and can pay back some of the
borrowed money including its interest. But, the longer
the payback period is, the higher the compound inter-
est rate will be. Therefore, line of credit payback
seems to be done as soon as possible.
Generally, the interest rate is expressed as annuals
(Hendrickson and Au 1989). Also, an annualized rate
that considers both compounding and lending fees
leads to Effective annual percentage rate (APR)
(Peterson 2013). To calculate the monthly interest
rate, this study assumes that a lender states the
6 M. TAVAKOLAN AND S. NIKOUKAR

effective APR to the contractor. It should be noted (stated in the ‘Cash Flow Model’ Section). The financ-
that each alternative may have limitations in helping ing flows including the borrowed money (financing
the model be more realistic. In practical situations, inflows), the repaid money (financing outflows), and
lenders may impose a limitation on the amount of a financing costs (financing outflows) are set up by
loan or withdrawal from a line of credit in each using Equations (15)–(17). These flows are inspired
period or total duration of a project. In addition to by the study of Alavipour and Arditi (2018).
several parameters of cash flow that are input by the TF ¼ M þ LP þ LR (14)
user, some financing data such as financing alterna-
Bt ¼ Babt þ BLPt þ BLCct t ¼ 0; 1; 2; . . . ; TF (15)
tives, APRs, interest payment times, total credit limits,
and credit limits in each period are taken from the Rt ¼ Rabt þ RLPt þ RLCct t ¼ 0; 1; 2; . . . ; TF (16)
user. This model also lets the contractor choose a Ft ¼ Fabt þ FLPt þ FLCct t ¼ 0; 1; 2; . . . ; TF (17)
maximum negative cumulative net balance of the cash
Where Bt ; Rt and Ft represent the borrowed
flow (MN) which means that the contractor can have
money, the repaid money, and the financing cost,
a negative cumulative cash flow during the project.
respectively, at the end of period t; a is the time of
Therefore, if the contractor has the ability to postpone
taking money for short-term loans; b is the time of
some expenses without any interest, the MN is set up
repaying the principal for short-term loans and ct is
as such. Otherwise, the MN is set to zero.
time of repaying for a line of credit after t month(s).
Also, net financing outflow at the end of period t
Model creation and objective function (TRt ) and net financing flow (NFt ) are subsequently
The primary purpose of this section is to determine the computed by Equations (18) and (19).
total financing cost based on project financing flows. For TRt ¼ Rt þ Ft t ¼ 0; 1; 2; . . . ; TF (18)
contractors, the profit of their projects often arrives at NFt ¼ Bt TRt t ¼ 0; 1; 2; . . . ; TF (19)
the end of the project. Usually, in this juncture, the posi-
The cumulative net balance of the financing cost
tive outcome of all the inflows and outflows represents
(NFCt ) is calculated by Equation (20), where NFCt1
the profit. However, it has to be considered that the
inflows and outflows do not occur at the same time but is the cumulative net financing costs from period zero
in different sections of the project time span. Therefore, to period (t1):

a present value of inflows and outflows needs to be Ft t¼0
NFCt ¼ (20)
employed to present a good schema of the project’s NFCt1 þ Ft t ¼ 1; 2; . . . ; TF
finance factors to contractors. This schema helps deci-
The objective function of the model is presented in
sion makers and project planners to select a proper
Equation (21):
option for each project activity to optimize all three
XTF
objectives time, cost, and profit concurrent. The profit Minimize FC ¼ 0
Ft (21)
estimation of the project is calculated in Equation (13).
X 1
 The two next sections illustrate the constraints of
P¼ inflow i  the model in two categories of financing and
i ð1 þ rÞti
X   (13) cash flow.
1
þ outflowj 
j ð1 þ rÞtj
Constraints of the financing
Where P¼profit of the project; ti ¼date of inflow;
similarly, tj denotes the date of outflow; and r¼ daily In the following, constraints of financing are pre-
interest rate. Counters i and j respectively illustrate sented from Equations (22)–(26):
the number of inflows and outflows. The total amount of borrowed money relative to
As discussed in the preceding two sections, the each short-term loan alternative (Tab ) should not
time at which the final payment is made and retain- exceed the total limit for each short-term loan alter-
age is returned is the sum of the project duration, the native (CLab )
XTr
lag in paying payment requests, and the lag to make Tab ¼ B  CLab t ¼ 0; 1; 2; . . . ; TF (22)
t¼0 abt
the final payment and return the retained money.
Equation (14) formulates the time of final payment The amount of borrowed money at the end of
which is donated by TF : To make the complete cash each period (t) for short-term loans (Babt ) and a long-
flow, the financing flows are added to cost flows term loan (BLPt ) should not exceed the limits of
 INTERNATIONAL JOURNAL OF CONSTRUCTION MANAGEMENT 7

short-term loans (CL0 ab ) and a long-term loan (CL0 LP ) Improved hybrid multi-objective algorithm (IHA)
in each period (t), respectively.
In order to understand the advantages and disadvantages
Babt  CL0 ab t ¼ 0; 1; 2; . . . ; TF (23) of each meta-heuristic algorithm and consequently
BLPt  CL0 LP t ¼ 0 (24) develop an improved hybrid algorithm, the authors devel-
oped and applied five general algorithms (Genetic algo-
The required credit at the end of each period rithm, Particle swarm, Ant colony, Magnetic charged
(CLCt ) should not exceed the total credit limit of line system and shuffled frog leaping) on a common case
of credit (CLLC ). study which can be found in literature. The case study
CLCt  CLLC t ¼ 0; 1; 2; . . . ; TF (25) whose network precedence relations and alternatives are
shown in Table 1, is an example of a hypothetical project
The withdrawal from the line of credit at the end
which is employed to demonstrate application of the
of each period (TBLCt ) should also not exceed the
TCTO model. Table 3 shows the results of five meta-heur-
credit limit in each period (CL0 LC ).
istic algorithms applied on the case study.
TBLCt  CL0 LC t ¼ 0; 1; 2; . . . ; TF (26) In most studies, GAs are used as a foundation of
hybrid algorithms. However, authors used the concept
of shuffled frog leaping algorithm as a base for the
Constraints of the cash flow hybrid algorithm. This is because of SFL’s reasonable
The cumulative net balance of the cash flow (includ- computation time that was presented in the last section.
ing financing flow), in period t; is denoted by N 0 t and Furthermore, given that chromosomes are grouped into
is computed by using Equation (27) memeplexes, it is simpler to monitor the behavior of
 chromosomes during the execution of the program.
0 Pt Et þ NFt t¼0
Nt¼ However, the quality of the solutions is not as good
N 0 t1 þ Pt Et þ NFt t ¼ 1; 2; . . . ; TF when compared with other algorithms. In larger search
(27) areas, failure to reach an optimal solution may be more
The minimum cumulative net balance of the cash frequent. Therefore, an auxiliary algorithm needs to be
flow (including financing flow) is denoted by MN utilized to increase the accuracy of optimal solutions. In
and the constraint N 0 t is provided in Equation (28) order to avoid time inefficiency, this algorithm should
not burden the calculation. In summary, the second
N 0 t  MN t ¼ 1; 2; . . . ; TF (28) algorithm must strike a balance between the quality of
solution and calculation time.
GAs are the most recognized meta-heuristic algo-
Pareto front rithms in recent years. A GA contains simple calcula-
Arranging a complete Pareto front is one of the important tions and its operator is easily customized. Hence, it can
stages in the optimization of different factors such as be a good alternative as the auxiliary algorithm.
time-cost optimization (Tavakolan and Share 2013). One However, some changes need to be applied to GA
of the significant features of the Pareto chart is that in a
set of answers, no one is superior to others. Therefore, for Table 1. 20-Activities Project schedule and cost data.
Name P1 P2 P3 Duration Cost MinTime MaxTime MinCost MaxCost
project plan makers, a Pareto front will provide more
0 0 0 0 0 0 0 0 0 0
flexibility in selecting suitable options for activities of the 1 0 0 0 9 45,000 7 13 35,000 65,000
project, according to the project conditions. Since the 2 0 0 0 7 115,000 4 8 70,000 130,000
3 0 0 0 9 46,500 8 16 42,000 78,000
objective of this study is to optimize time, cost and profit 4 1 2 0 4 60,000 2 6 42,000 78,000
of project in parallel, a set of non-dominated solutions 5 2 0 0 2 28,000 2 4 28,000 52,000
6 2 3 0 4 76,500 3 7 63,000 117,000
among all solutions is needed. So the basis of Pareto dom- 7 4 5 6 5 20,000 3 7 14,000 26,000
inance is utilized. As shown in Equation (29), if the situ- 8 5 0 0 5 21,000 5 11 21,000 39,000
ation described below occurs, a decision vector u is said 9 6 0 0 4 42,000 4 10 42,000 78,000
10 7 8 0 4 63,000 4 8 63,000 117,000
to strictly dominate the decision vector v : 11 6 8 0 6 11,5000 3 7 70,000 130,000
12 9 11 0 7 48,000 6 12 42,000 78,000
ðDu <Dv and Cu  Cv Þ or ðDu  Dv and Cu <Cv Þ 13 10 11 0 10 48,000 5 11 28,000 52,000
14 11 0 0 3 49,000 3 7 49,000 91,000
(29) 15 12 13 14 3 59,500 2 6 49,000 91,000
16 13 0 0 5 76,500 4 8 63,000 117,000
where Du and Dv are durations of u and v decisions, 17 15 0 0 7 60,000 4 10 42,000 78,000
respectively. Correspondingly, Fu and Fv are financing 18 12 15 0 7 65,000 3 7 35,000 65,000
cost of u and v decisions. 19 16 17 18 4 42,000 4 10 42,000 78,000
8 M. TAVAKOLAN AND S. NIKOUKAR
operators to improve their efficiency. In the following
section, the structure of hybrid SFL-Improved GA
is developed.
Hybrid algorithm structure
Figure 1 shows the flowchart of the hybrid algorithm.
As can be seen, the process of implementation is
Figure 1. IHA flowchart.
categorized into three main phases. The following sec-
tions describe phases specifically and separately.
Phase 1: Initialization
In this phase of the model, an initial set of possible
solutions with the population of S is generated ran-
domly. Then, a reproduction function is used to
improve initial generation quality. A function is
engaged to prevent the creation of repetitive answers.

Therefore, maximum of various possible solutions are
produced. The initialization phase in this model is
performed in two main steps.
(1) Read all case study and algorithm parameters.
Parameters of the case study include number of activ-
ities of the case study, predecessors and successors of
activities, executive options of each activity and con-
sequently direct cost and duration time of each
option, retainage rate, markup rate, monthly interest
rate, mobilization cost, bond premium cost and over-
head and tax rate. IHA’s parameters contain initial
population, number of memeplexes, number of gener-
ations and length of chromosomes which is equal to
the number of activities of the case study.
(2) Generate the initial population with a set of
random solutions. Then a quick sort function is
obtained to sort the solution order by fitness value.
Considering the reproduction rate, some solutions
with lower ranks is omitted and new random solu-
tions with higher ranks are replaced. These new high
ranked random solutions increase the convergence
rate and quality of optimal solutions.
Phase 2: Fitness evaluation
The main goal of this phase is to calculate the time
and direct cost of project and cash flow parameters,
including cash inflows and outflows, for each possible
solutions s in generation g to determine the fitness of
the solution. This phase evaluates the three major
objectives of this study using the following four steps.
(1) Calculate the project duration for each solution
s in generation g using the previously explained pro-
cess in the activity relationship section.
(2) Calculate the total project cost for each solution
s in generation g using the previously explained pro-
cess in the cost estimation section.
(3) Calculate the project’s cash inflows and out-
flows for each solution s in generation g using the
further process which will be explained in the case
study section.
(4) Calculate the project profit for each solution s
in generation g using the cash flow parameters,
described in the previous step and the previously
explained process in the Profit Estimation section.
Phase 3: Generation improvement
The main purpose of this phase is to create a popula-
tion of a new generation using SFL operators and
improved genetic operators. The procedure of this
phase is implemented in the following six steps.
INTERNATIONAL JOURNAL OF CONSTRUCTION MANAGEMENT 9
(1) Chromosomes are sorted and evaluated by the
fitness function.
(2) Regarding the number of memeplexes, the
chromosomes are classified in groups. The process is
that the best chromosome enters the first group. Next
chromosome goes into the second memeplex. Once
the first member of the last memeplex arrives, the
next member goes to the first group again and this
cycle continues until the classification of the last
chromosome of the population.
(3) The worst chromosome of each group is devel-
oped through SFL operator which is shown in
Equations (30) and (31).
Di ¼ RandðÞ  ðXb Xw Þ (30)
Xw;tþ1 ¼ Xw þ Di Dmax  Di  Dmax (31)
where RandðÞ is a random real number between 0
and 1; Di is change in the position of chromosome;
Dmax is maximum change in the position of chromo-
some; and Xw and Xw;tþ1 are the position of the
chromosome in current and next generation,
respectively.
(4) Two chromosomes from the remaining chro-
mosomes of each group (all chromosomes except best
and worst one) are selected randomly and a one-point
crossover operator is applied. Also, the crossover
point is selected arbitrarily. Therefore, two new mem-
bers from each group are added to the current popu-
lation. The new members, the best of each memeplex,
and a global best chromosome are chosen for
improved mutation. The improved mutation function,
whose process is stated in the next section, is defined
to increase the convergence rate in a reasonable com-
puting time.
(5) All chromosomes (s initial population plus k
new child chromosomes) are evaluated with the fit-
ness function and then sorted in descending order.
The last k chromosomes which have a lower fitness
function value are removed from the population.
(6) The remaining population are shifted to the
next generation.
Improved mutation function
The general GAs mutation function randomly selects
one or more genes from a chromosome and changes
its value. This may result in the chromosome getting
away from the optimal solution. Hence, the improved
function needs to avoid facing this problem and con-
sequently, if a mutated chromosome has lower fitness
function, the changes should be ignored.
10 M. TAVAKOLAN AND S. NIKOUKAR

Additionally, due to the random nature of muta- Validation of the model

tion function, repetitive and weak mutated chromo-
somes may be produced over the generations.
Furthermore, it may result in massive calculations for
the program. This problem has a significantly nega-
tive effect on large search space problems.
To enhance the impact of the mutation function,
some changes are applied without removing its ran-
dom nature. An integer array which contains available
genes for mutation is attached to each chromosome.
An integer array is also attached to each gene that
carries available options for a mutation function to
select from. Improved mutation function randomly
chooses its gene and options from the available genes
and options that have been included in the array of
chromosome and its genes. If the changes do not lead
to a better solution, the related options are removed
from the array. The number of mutations trying to
improve each chromosome fitness is limited to a spe-
cific number in each generation. Finally, if there is no
change in the global best chromosome of the popula-
tion in one generation, the next mutation is applied
to a smaller and more efficient space. This results in
increasing the quality of solution while avoiding too
much computing time.
Table 2. Project cost and contract data.
Data type Item
Cost data OF
OV
OM
OMP
OB
Contract terms OAP
R 10%
LP
Submitting pay requests interval
LR
An example project accomplished by Alavipour and
Arditi (2018) is used to validate the model. The pro-
ject information is shown in Table 1. Also, cost data
and contract terms assumptions are presented in
Table 2. These data are input by the user in a form
produced using VISUAL STUDIO. The schedule data
are read from an Excel sheet by the form. Also, the
CPM calculation is done in the Excel sheet. The solv-
ing program is written in VB.net language. After
starting the program, the costs of the project and the
contract bid price are calculated. Then, the project
cash flow is computed using mentioned Equations to
be used in the calculation of project financing flow.
In this example, all suggested financing options are
considered. In addition, no credit limit is considered
for the problem. For APRs, the long-term loan is
assigned a 7% APR, short-term loans are assigned
between 8% for a 12-month loan to 23% for a 3-
month loan; and a line of credit is assigned a
15% APR.
To solve this example, the proposed hybrid algo-
rithm is used. The population has been stagnant over
20 generations. The chromosomes are categorized
into 30 groups. The number of iterations is equal to
100. The programming models were coded using
20-Activities network VISUAL STUDIO 2013. All the experiments were
25000 conducted using a laptop with a Core i7, 2.2GHz
10% Intel processor and 8GByte of RAM. In addition, the
5%
6% stopping criteria of the meta-heuristics were deter-
1% mined by the number of generations in each test.
0%
The results obtained by the proposed hybrid algo-
1 rithm are presented in Table 3. A comparison
1
0 between the results of this study and the research
results of Alavipour and Arditi (2018) can be seen in

Table 3. Model output of optimized financing cash flow.

Project Long-term loan Short-term loans Line of credit
Month Inflow Outflow Inflow Outflow Inflow Outflow Inflow Outflow
0 – 522,260 1,358,798 – 212,769 – – –
1 – 768,000 – 94,738 – 1,369 – –
2 1,082,229 958,000 – 94,738 – 1,369 – –
3 927,625 749,000 – 94,738 38,292 1,369 – –
4 760,137 793,000 – 94,738 – 1,901 – –
5 773,021 760,000 – 94,738 – 1,901 – –
6 850,323 936,000 – 94,738 74,949 1,901 – –
7 1,030,694 1,068,000 – 94,738 – 2,995 121,394 –
8 1,043,578 595,000 – 94,738 – 2,995 – 122,816
9 515,347 408,000 – 94,738 169,479 116,236 – –
10 283,441 672,000 – 94,738 – 3,844 193,260 –
11 824,555 837,000 – 94,738 – 3,844 306,551 195,524
12 798,788 474,000 – 94,738 – 386,092 466,184 310,142
13 373,627 364,000 – 94,738 – – 556,756 471,645
14 309,208 298,000 – 94,738 – – 646,808 563,278
15 1,235,402 – – 94,738 – – – 654,385
Total 10,807,975 10,202,260 1,358,798 1,421,070 495,489 525,816 2,290,953 2,317,790
Net Cumulative Balance 605,715 (62,272) (30,327) (26,837)

Table 4. As can be seen, the results are approximately
equal, while the value of the total financing cost in
this study is slightly less as the profit of the project is
marginally more for the proposed algorithm. This
shows that the hybrid algorithm is superior in obtain-
ing optimum (near-optimum) solutions in
such problems.
Results
The proposed model is used to develop a Pareto chart
which provides a group of non-dominated solutions.
Hence, the model is applied to two tests that are dif-
ferent in complexity and can challenge the model in
terms of quality of results and processing time. The
first test has the same network as before, with the dif-
ference that the duration and cost of the activities
fluctuate in defined intervals. The relationship
between the time and direct cost of activities is
assumed to be linear and inverse. Therefore, as the
duration of an activity increases, its related direct cost
falls. Figure 2 shows the optimal Pareto front of the
developed model for the 20-activities project. The fig-
ure presents the results when the inputs obtain the
values shown in Table 2.
Table 5 shows the details of the second test
example. As can be seen in this table, the project net-
work contains 63 activities. The relationships among
Table 4. Comparison between the results of the proposed
model and the previous study.
Alavipour and
Obtained Arditi (2018)
Financial parameters results results
Total financing cost of the project ($) 119,436 120,202
Profit of the project ($) 486,279 484,013
Figure 2. 20-Activities Pareto front chart.
INTERNATIONAL JOURNAL OF CONSTRUCTION MANAGEMENT 11
activities and the project data are inspired by Sonmez
and Bettemir (2012) study. The cost data and contract
terms of this project are shown in Table 6. In this
test, each activity has a specified range for the dur-
ation and its linked direct cost from which to select.
Similar to the previous test, the relationship between
time and the direct cost is considered linear and
inverse. Thus, each activity has a minimum and max-
imum duration for implementation. The number of
options depends on the difference between the max-
imum and minimum duration. The objective of this
test is to concurrently minimize the total cost of
finance options and the duration of the project.
An initial population of 300 solutions was pro-
duced randomly by selecting different executive meth-
ods for each activity. The process then continued
with 30 memeplexes for 200 iterations of generations.
At the end of the process, the results were converted
to a Pareto front chart. These results are presented in
Figure 3 and suggest a tradeoff between time and
financial cost of the project. The results show that the
project time varies from 73 to 102 working days with
varying levels of financing cost. Figure 3 indicates
that the final generation improved significantly when
compared with the initial population since the dur-
ation and financial cost decreased over generations.
Hence, the final profit of the project increases. The
minimum duration and minimum financing cost for
the initial population were 79 days and 23,803$,
respectively. After the 200 generations, the minimum
obtained duration and financing cost was 78 days and
8639$ correspondingly. These outcomes show the
process that these two conflicting objectives are opti-
mized from the first population through the
last population.
Despite numerous calculations of cash flow param-
eters and extremely large search space, the processing
12 M. TAVAKOLAN AND S. NIKOUKAR

Table 5. 63-Activities Project schedule and cost data. Table 6. 63-Activities Project schedule and cost data.
Name P1 P2 P3 Duration Cost MinTime MaxTime MinCost MaxCost Data type Item 63-Activities network
0 0 0 0 0 0 0 0 0 0 Cost data OF 16100
1 0 0 0 2 2700 1 2 1875 3125 OV 10%
2 0 0 0 3 5401 2 3 3750 6550 OM 5%
3 0 0 0 3 9317 2 4 7484 10,550 OMP 6%
4 0 0 0 3 7200 2 3 5934 7200 OB 1%
5 0 0 0 4 9563 3 4 7795 10,350 Contract terms OAP 0%
6 1 0 0 6 10,539 5 7 9044 11,359 R 10%
7 1 0 0 5 10,963 4 6 9520 11,950 LP 1
8 2 0 0 7 10,372 5 8 8878 11,679 Submitting pay requests interval 1
9 3 0 0 8 10,780 7 9 9094 12,438 LR 0
10 4 0 0 8 9475 5 9 8313 10,807
11 5 0 0 8 12,224 6 9 10388 14,050
12 6 0 0 9 9725 7 10 8389 10,728
13 7 0 0 5 8792 4 6 6850 9750
14 1 8 0 4 15,849 3 5 13188 1663 project. Also, the selected financial option leads them
15 9 0 0 5 9527 4 7 7628 10,820
16 9 10 0 10 11,273 8 11 9460 13,285 to related time and cost for each activity.
17 10 0 0 7 13,034 6 9 11208 13,522
18 10 11 0 10 15,458 8 12 12715 16,190
19 11 0 0 5 20,340 4 6 16500 20,340 Sensitivity analysis
20 12 0 0 5 11,894 4 6 9670 13,360
21 13 0 0 9 11,090 7 10 9473 12,639 A sensitive analysis is performed to examine the
22 14 0 0 8 10,838 6 9 9282 12,175
23 15 0 0 6 12,636 4 7 11075 14,742 effects of changes in contract data on the total financ-
24 16 0 0 9 9300 7 10 8056 10,712 ing cost of the project. As shown in Table 7, the ana-
25 17 0 0 7 1055 5 8 9522 12,400
26 18 0 0 11 1016 8 12 8500 11,682 lysis is applied based on changes in the percentage of
27 20 0 0 9 9899 7 10 8723 10,528 monthly repayment retained by the owner (R), the
28 21 0 0 9 10,280 7 10 9445 11,167
29 22 0 0 10 10,459 8 11 9270 11,560 percentage of the contract bid price advanced by the
30 23 0 0 5 6351 3 5 5500 7240 owner at the start of the project (OAP ), and the lag in
31 25 19 0 12 14,055 10 14 12084 15,759
32 26 0 0 6 8578 4 7 7192 10,242
owner payments (LP ). The Pareto front chart of each
33 26 0 0 7 9825 5 8 8750 11,358 sensitivity analysis number (as noted in Table 7) is
34 28 30 0 10 9973 8 11 8925 11,425 displayed in Figure 4 and can be compared
35 27 29 24 17 14,003 14 20 10765 17,500
36 24 0 0 6 9464 4 8 7917 11,375 with others.
37 31 0 0 5 5348 3 5 4500 6320 The worst condition occurs when there is no
38 32 0 0 7 3036 5 8 8750 11,486
39 33 0 0 9 10,235 7 10 9017 11,423 advanced payment and the owner pays the contractor
40 34 0 0 6 8532 4 6 7542 9700 with 1 month lag while deducting the retainage.
41 35 0 0 4 6710 3 6 4375 8075
42 36 0 0 6 7132 4 7 6067 8375 Therefore, a significant amount of financing cost is
43 36 0 0 9 8491 7 11 7423 9578 needed to ensure that the contractor debt will not
44 37 0 0 10 12,698 9 12 10275 14,600
45 39 0 0 8 12,661 6 9 10594 17,844 exceed the limits of credibility (assumed zero in
46 39 0 0 9 12,030 7 10 10473 15,112 this study).
47 40 0 0 7 11,945 5 8 10500 13,343
48 42 0 0 6 7302 4 6 6125 8992
The role of advanced payment in reduction of
49 38 41 44 21 14,854 17 25 12739 18,941 finance cost is evident from sensitivity analyses number
50 45 0 0 9 8533 7 15 5312 10,167 3, 4 and 7 as these have the three lowest finance costs.
51 46 0 0 11 8955 8 12 7691 10,291
52 47 0 0 4 7449 3 5 5788 8800 Among these three mentioned sensitivity analyses, the
53 43 48 0 5 7557 3 6 6300 8920 situation that the owner pays the contractor without
54 49 0 0 3 6580 2 4 5500 8100
55 52 53 0 4 6728 3 5 5850 8125 any delay (LP ¼0) and does not withhold any retainage
56 50 53 0 5 9557 4 6 8250 11,090 (R¼0) hast the lowest finance cost (number 3).
57 51 54 0 5 9121 4 6 7560 10,680
58 52 0 0 3 5087 2 4 4167 6484 Moreover, in case of having advanced payment, the
59 55 0 0 4 10,313 2 4 8650 12,688 impact of payment lag and retainage are nearly equal as
60 56 0 0 4 8310 3 5 7125 10,950
61 56 57 0 4 6813 2 5 5625 8375
it can be observed in numbers 4 and 7.
62 60 0 0 3 14,917 2 4 12917 17,034
63 61 0 0 4 2525 3 4 2375 3175
Practical contribution of the proposed model
time to reach the last generation was about Currently, existing planning software (i.e., Primavera
10 minutes suggesting a reasonable time. These out- P6 and MS Project) does not have the ability to create
comes let the Managers have the ability to select their schedules with different options. These software pack-
suitable financing options based on the tradeoff ages have significant shortcomings in this area of
between the total time and financing cost for the scheduling. Using the deterministic method of
 INTERNATIONAL JOURNAL OF CONSTRUCTION MANAGEMENT 13

Figure 3. 63-Activities Pareto front chart.

Table 7. Sensitivity analysis results.

Number Contract terms Minimum financing cost ($)
Retained percentage of pay requests (R) Advance payment percentage (OAP ) Lag in paying payment requests (LP ) (months)
1 (0-0-0) 0 0 0 24981
2 (0-0-1) 0 0 1 73662
3 (0-5-0) 0 5 0 8639
4 (0-5-1) 0 5 1 11430
5 (10-0-0) 10 0 0 32153
6 (10-0-1) 10 0 1 80374
7 (10-5-0) 10 5 0 15553
8 (10-5-1) 10 5 1 43125

Figure 4. Sensitivity analysis Pareto front charts.

scheduling in such software often leads to schedules
having major problems. Moreover, failure to obtain
financing methods in a scheduled project (using cur-
rent software) will divert project scheduling from
existing reality, which makes the implementation of
the schedule not practical.
As mentioned throughout the article, practical con-
tribution of this study targets both finance scheduling
solutions and the way to obtain to these solutions.
This means that project planners who tend to use
planning tools regardless of project changeable nature
may benefit from using advanced planning tools with
the ability to determine optimized project scheduling
and financing options by using the model proposed
in this study.
The proposed method may be added to existing
planning software as a plugin in order to provide a
range of financing methods and scheduling alterna-
tives for planners. Also, the offered model is going to
be utilized in several construction projects in Iran and
14 M. TAVAKOLAN AND S. NIKOUKAR
is considered to be formed as a general plugin which
is capable of determining a set of financing and
scheduling optimal solutions.
Conclusion
This article presented a finance-based schedule model
that can handle a variety of constraints. A hybrid
meta-heuristic algorithm, which considers SFL as the
primary algorithm and uses an improved GA as sub-
sidiary, was applied to solve the problem. The follow-
ing are some significant improvements that are
accomplished by using the proposed model, as com-
pared to previous research.
(1) The model allows construction planners to
make and evaluate optimal construction cash resource
utilization and scheduling plans. Each of these plans
is determined from a set of feasible executive and
finance options.
(2) As a result, the proposed model identifies an
appropriate scheduling plan with its related cash flow
which helps project managers advance their projects
as best as possible.
(3) Considering different financing and execution
alternatives may lead to lowering the financing cost
and increasing the profit of the projects. It gives the
model enough flexibility to accommodate as many
alternatives as available. Therefore, a contractor can
directly apply the real condition in the real project
area in the model by disregarding those alternatives
that are non-existent.
(4) Several financing alternatives included in the
proposed model causes the contractor to utilize fewer
activity floats as they do not limit the use of the
floats. This feature is more appropriate when several
execution methods exist and subsequently duration of
activities can be changed by adjusting the number of
related resources.
(5) Considering multiple finances, several execution
methods, and a more complex project with a large
number of activities may need enormous processing
time. However, the proposed hybrid algorithm can
reach the optimal/near-optimal solutions in a reason-
able time.
(6) Use of the model in both simple and complex
projects can be particularly advantageous as calcula-
tions for complex projects may be extremely
time-consuming.
The proposed model is an obvious improvement
over past models since it not only optimizes a more
realistic financing cost model in a reasonable process-
ing time, but it also combines several separate
contexts of optimization problems in construction
projects which allows the model to be more practical.
However, this research has some limitations. First,
while the construction companies may need to
finance and manage a portfolio of projects, this study
considers single project optimization. Second, separat-
ing procurement and construction scheduling can
make the research problem more realistic as it can be
used by project planners to satisfy contractor financial
needs. Third, the fuzzy theory can be included in fur-
ther research as it will lead to a more complete
understanding of the performance of the hybrid algo-
rithm. Moreover, the hybrid strategy presented in this
paper can be improved further by considering the
effects of chromosomes on each other as well as genes
through generations.
Disclosure statement
No potential conflict of interest was reported by
the authors.
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