Construction Management

VAB 4043

Lecture 7(b) Resource Allocation & Leveling

1.0 Resource Allocation and Leveling

Resources of a project need to be

scheduled i.e. right amount of resources must be allocated to a given task at the required time leveled i.e. distributed accordingly at the required time to avoid or minimize fluctuations in day-to-day use.

Resource Leveling (RL) makes use of floats or time tolerances in the schedule to re-schedule resources and bring back any deviation of actual progress from schedule to within acceptable limits RL applies to resources which are hired i.e. labour and equipment but not material. The need for these 2 resources fluctuates greatly as some activities start (requiring resources) while other finish (releasing resources) RL improves efficiency and minimize project cost (by optimizing labour usage and cost)
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1.1 Conceptual Example

Assigning Resources to Tasks

- first, assume youve unlimited resources - determine deadline; check whether unlimited resource assumption has overloaded available resources:

Need 2

Need 1

Need 1

Need 2 *Have 3 available Time (weeks)

Fig. 1.1 Schedule with resources overloaded

1.1 Conceptual Example

Assigning Resources to Tasks

- check any task with enough float; to allow delay until resources become available - leveling is done at Task C

Need 2

Need 1

Need 1

Need 2 *Have 3 available Time (weeks)

Fig. 1.2 Schedule using float to level resources

1.1 Conceptual Example

Assigning Resources to Tasks

- Now, Task D needs 3 people; complicates the situation - three possibilities; reduce scope, change time limit or reduce performance

Need 2

Need 1

Need 1

Need 3 *Have 3 available Time, weeks

Fig. 1.3 Schedule with inadequate float on C to permit leveling

1.1 Conceptual Example

Assigning Resources to Tasks
- use all the float on Task C; now it becomes critical-path task timecritical resource leveling - sliding tasks over until resources become available resource-critical leveling

Need 2

Need 1

Need 1

Need 3 *Have 3 available Time, weeks

Fig. 1.4 Schedule under resource-critical conditions

1.1 Resource Allocation and Leveling (cont.)

STEPS:

Determine critical path and floats from network or other techniques Identify key resource and produce bar chart using network data Plot histogram of resource demand Reschedule timing of activities using float to obtain a more even demand profile Redraw the resource profile

NB. Resource leveling may result in project delay time , if necessary (i.e. if cost saving is more important to be achieved)
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1.2 Resource Allocation and Leveling (cont.)

Example Resource Allocation : Flooring Project

ACTIVITY DESCRIPTION IPA* DURATION LABOUR

A B C D E

Delivery Of Materials

5 7 3 5 2

2 4 3 3 2

Remove Old Tiles Install Ceramic Tiles Install Vinyl Tiles Clean Up And Inspect A A,B C,D

Immediately Preceding Activity

Example Resource leveling process

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Construction Management
VAB 4042

Lecture 8 Project Control

Project Control
MANPOWER

MATERIALS

METHODS

PROJECT

MONEY

MACHINES

FIVE RESOURCES FOR PROJECT (5M)

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Project Management Body of Knowledge (PMBOK)

(I) The Project Management Framework (II) The Standard for Project Management of a Project (III) The Project Management Knowledge Areas (IV) Appendices (V) Glossary and Index

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The Project Management Knowledge Areas

Project Integration Management Project Scope Management

Project Time Management

Project Cost Management Project Quality Management Project Human Resources Management

Project Communication Management

Project Risk Management Project Procurement Management
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Project Time Management

Activity Definition Activity Sequencing

Activity Resource Estimating

Activity Duration Estimating Schedule Development Schedule Control

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Schedule Control

Schedule Control is concerned with

Determining the current status of the project schedule Influencing the factors that create schedule changes Determining that the project schedule has changed Managing the actual changes as they occur

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Schedule Control
Inputs
1. Schedule management plan 2. Schedule baseline 3. Performance reports 4. Approved change requests

Tools & Techniques

1. Progress reporting 2. Schedule change control system 3. Performance measurement 4. Project management software 5. Variance analysis 6. Schedule comparison bar charts

Outputs
1. Schedule model data (updates) 2. Schedule baseline (updates) 3. Performance measurement 4. Requested changes 5. Recommended corrective actions 6. Organizational process assets (updates) 7. Activity list (updates) 8. Activity attributes (updates) 9. Project management plan (updates)
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Schedule Control Inputs

Schedule Management Plan

Contains the schedule management plan that establishes how the project will be managed and controlled.

Schedule Baseline
Component of the PM plan that provides the basis for measuring and reporting schedule performance.

Performance Report
Provide information on schedule performance such as which planned dates have been met and which have not.

Approved Change Requests

To update the project schedule baseline or other components of the PM plan.

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Schedule Control Tools & Techniques

Progress Reporting
Includes information such as actual start and finish dates, and the remaining durations for unfinished activities.

Schedule Change Control System

Defines the procedures by which the project schedule can be changed.

Performance Measurement
Produce the Schedule Variance (SV) and Schedule Performance Index (SPI), which are used to access the magnitude of any project schedule variations that do occur.

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Schedule Control Tools & Techniques cont.

Project Management Software

Provides the ability to track planned dates versus actual dates, and to forecast the effects of project schedule changes, real or potential.

Variance Analysis
Comparing target schedule dates with the actual/forecast start and finish dates for the detection of deviations and for the implementation of corrective actions in case of delays.

Schedule Comparison Bar Charts

To facilitate analysis of schedule progress. Displays two bars for each activity. One bar shows the current actual status and the other shows the status of the approved project schedule baseline.

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Schedule Control Outputs

Schedule Model Data (updates)

A project schedule update is any modification to the project schedule model information that is used to manage the project.

Schedule Baseline (updates)

Changes to the schedules start and finish dates.

Performance Measurements
The calculated schedule variance (SV) and schedule performance index (SPI) values for WBS components.

Requested Changes
SV analysis along with review of progress reports, results of performance measures, and modifications to the project model can result in requested changes to the project schedule baseline.

Recommended Corrective Actions

Anything done to bring expected future project schedule performance in line with the approved project schedule baseline.

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Schedule Control Outputs cont

Organizational Process Assets (updates)

Lessons learned documentation of the causes of variance, the reasoning behind the corrective actions chosen, and other types of lessons learned from schedule control are documented in the organizational process assets.

Activity List (updates)

Updated comprehensive list including all schedule activities that are planned.

Activity Attributes (updates)

Updated activity attributes for each schedule activity.

Project Management Plan (Updates)

The schedule management plan component of the PM plan is updated to reflect any approved changes.

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Project Cost Management

Cost Estimating Cost Budgeting

Cost Control

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Cost Control

Cost Control includes

Influencing the factors that create changes to the cost baseline Ensuring requested changes are agreed upon Managing the actual changes when and as they occur Assuring that potential cost overruns do not exceed the authorized funding periodically and in total for the project. Monitoring cost performance to detect and understand variances from the cost baseline Recording all appropriate changes accurately against the cost baseline Preventing incorrect, inappropriate, or unapproved changes from being included in the reported cost or resource usage Informing appropriate stakeholders of approved changes Acting to bring expected cost overruns within acceptable limits

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Cost Control
Inputs
1. Cost baseline 2. Project funding requirements 3. Performance reports 4. Work performance information

Tools & Techniques

1. Cost change control system 2. Performance measurement analysis 3. Forecasting 4. Project performance reviews 5. Project management software 6. Variance management

Outputs
1. Cost estimate (updates) 2. Cost baseline (updates) 3. Performance measurements 4. Forecasted completion 5. Requested changes 6. Recommended corrective actions 7. Organizational process assets (updates) 8. Project management plan (updates)

5. Approved change requests

6. Project management plan

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Cost Control Inputs

Cost Baseline
A time-phased budget that is used as a basis against which to measure, monitor, and control overall cost performance of the project. Usually displayed by S-curve

Project Funding Requirements

Funding requirements, total and periodic, are derived from the cost baseline and can be established to exceed, usually by a margin, to allow for either early progress or cost overruns.

Performance Reports
Provide information on cost and resource performance as a result of actual work progress.

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Cost Control Inputs cont

Work Performance Information

Work performance information pertaining to the status and cost of project activities being performed is collected.

Approved Change Requests

Include modifications to the cost terms of the contract, project scope, cost baseline, or cost management plan.

Project Management Plan

The project management plan and its cost management plan component and other subsidiary plans are considered when performing the Cost Control process

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Cost Control Tools & Techniques

Cost Change Control System

Defines the procedures by which the cost baseline can be changed.

Performance Measurement Analysis

Assess the magnitude of any variances that will invariably occur. The Earned Value (EV) technique is used.

Forecasting
Making estimates or predictions of conditions in the projects future based on information and knowledge available at the time of the forecast.

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Cost Control Tools & Techniques

cont

Project Performance Reviews

Compare cost performance over time, schedule activities or work packages overrunning and under-running budget (planned value), milestones due, and milestones met.

Project Management Software

PM software, such as computerized spreadsheets, is often used to monitor Planned Value (PV) versus Actual Cost (AC), and to forecast the effects of changes or variances.

Variance Management
The amount of variance tends to decrease as more work is accomplished. The larger variances allowed at the start of the project can be decreased as the project nears completion. The cost management plan describes how cost variances will be managed.
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Cost Control Outputs

Cost Estimates (updates)

Revised schedule activity cost estimates are modifications to the cost information used to manage the project.

Cost Baseline (updates)

Budget updates are changes to an approved cost baseline.

Performance Measurement
The calculated CV, SV, CPI, and SPI value for WBS components.

Forecasted Completion
Either a calculated EAC or ETC value or a performing organization-reported EAC or ETC value is documented and communicated.

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Cost Control Outputs cont

Requested Changes
Analysis of project performance can generate a request for a change to some aspect of the project. Identified changes can require increasing or decreasing the budget.

Recommended Corrective Actions

Anything done to bring expected future performance of the project in line with the PM plan.

Organizational Process Assets (updates)

Lessons learned are documented so they can become part of the historical databases for both the project and the performing organization.

Project Management Plan (updates)

Schedule activity, work package, or planning package cost estimates, as well as the cost baseline, cost management plan, and project budget documents are components of the PM plan. All approved change requests affecting those documents are incorporated as updates to those documents.
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S CURVE
100%

Completion

Job Progress

Delay
Unachieved Work

Job Start

0%
Timenow Time

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100%

AC

PV

Schedule Variance

EV

Cost Variance Timenow Slippage

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Time

Overspend

EARNED VALUE

Earned Value Terminology

Time-now, also called progress to date, is the date when progress is measured Budget at Completion (BAC) is the original cost estimate or budget indicating the funds required to complete the work

Percentage Complete (PC) is the work progress to time-now

Estimate at Completion (EAC) is a revised estimate of the cost to complete the work, based on current productivity

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Week 7

Earned Value Terminology

Planned Value (PV) is the portion of the cost that is planned to be spent on the work between the start date and time-now
PV = PC(planned) x BAC Earned Value (EV) is the budgeted amount for the work actually completed on the schedule activity during a given time period. EV = PC (actual) x BAC Actual Cost (AC) is the total actual cost incurred between the start date and timenow
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Week 7

Earned Value Terminology

Assuming productivity to-date will continue at the same rate to the end of the project, EAC = AC/EV x BAC But EV = PC(actual) x BAC

Therefore EAC = AC/PC(actual)

Schedule Variance (SV) is the difference between the current progress and the scheduled progress. SV = EV PV Note SV is in money units

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Week 7

Earned Value Terminology

Schedule Variance (SV) is the difference between the current progress and the scheduled progress.

SV = EV PV
Note SV is in money units Schedule Variance Percentage (SV%) SV% = SV/EV Cost Variance (CV) is the difference between the works estimated cost and its actual cost. CV = EV AC
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Week 7

Earned Value Terminology

The Cost Performance Index (CPI) is the ratio of budgeted costs to actual costs. CPI = EV/AC
The Schedule Performance Index (SPI) is the ratio of work performed to work scheduled. SPI = EV/PV

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EAC

BAC
PC (Planned) AC

PV

SV
PC (Actual) EV

CV

Time-now
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An Earned Value Example

Activity Number Design Foundation Structures Furnishing Plumb/Elect Weekly Expenditure PV PC (planned) EV PC (actual) AC BAC 100 400 1200 600 200 2500 100 100 4% 600 700 28% 625 25% 750 600 1300 52% 700 2000 80% 300 2300 92% 1 100 200 400 200 400 400 300 300 200 200 2500 100% 2 3 4 5 6

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Sample Calculations
Assume Time-now is End of Week 2. From the Table: BAC = $2,500 PV = $700 PC (Planned) = 28% EV = $625 PC (Actual) = 25% AC = $750 SV = EV PV = $625 - $700 = - $75

CV = EV AC = $625 - $750 = - $125

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SPI = EV/PV = $625/$700 = 0.89 CPI = EV/AC = $625/$750 = 0.83

EAC (Schedule) = Total Scheduled Period/SPI = 6 weeks/0.89 = 6.74 weeks = 5 days delay EAC (Cost) = BAC/CPI = $2,500/0.83 = $3,012 ($512 over)

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EAC

BAC
PC (Planned) AC

+$512

PV

SV
PC (Actual) EV

CV
+5 days

Time-now
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