Modern Construction Management E-Book

Frank Harris

• Herausgeber: John Wiley & Sons
• Kategorie: Wissenschaft und neue Technologien
• Sprache: Englisch

Seitenzahl: 857

Veröffentlichungsjahr: 2013

Beschreibung

This new edition of a core undergraduate textbook for construction managers reflects current best practice, topical industry preoccupations and latest developments in courses and fundamental subjects for students. While the construction process still requires traditional skills, changes over recent decades today demand improved understanding of modern business, production and contractual practices. The authors have responded accordingly and the book has undergone a thorough re-write, eliminating some of the older material and adding new processes now considered essential to achieving lean construction. Particular emphasis is given, for example, to supply chains and networks, value and risk management, BIM, ICT, project arrangements, corporate social responsibility, training, health and welfare and environmental sustainability. Modern Construction Management presents construction as a socially responsible, innovative, carbon-reducing, manager-involved, people-orientated, crisis-free industry that is efficient and cost effective. The overall themes for the Seventh Edition are: * Drivers for efficiency: lean construction underpinning production management and off-site production methods. * Sustainability: reflecting the transition to a low carbon economy. * Corporate Social Responsibility: embracing health & safety, modernistic contracts, effective procurement, and employment issues. * Building Information Management: directed towards the improvement of construction management systems. The comprehensive selection of worked examples, based on real and practical situations in construction management and methods will help to consolidate learning. A companion website at href="http://www.wiley.com/go/MCM7">www.wiley.com/go/MCM7 offers invaluable support material for both tutors and students: * Solutions to the self-learning exercises * PowerPoint slides with discussion topics * Journal and web references Structured to reflect site, business and corporate responsibilities of managers in construction, the book continues to provide strong coverage of the salient elements required for developing and equipping the modern construction manager with the competencies and skills for both technical and business related areas.

Leseprobe

Table of Contents

Companion website

Title page

Copyright page

Preface to the sixth edition

Preface to the seventh edition

Chapter 1 Introduction

Structure of the book

Objectives and contents

Section 1

Section 2

Section 3

Section 4

Chapter 2 Quality management

Summary

Introduction

Notions of quality

Quality in transition

Quality control and inspection

Quality assurance

Total Quality Management

A systems approach to managing quality

Section 1: Project production management

Chapter 3 Production process improvement

Summary

Introduction to lean construction

Productivity

Economic development

Energy consumption

Sustainability

International environmental protocols

UK emissions

Productivity improvement

Management systems

Management processes (BSI (2002), BS 6079-1:2002)

Employee participation

Macro key performance indicators

Chapter 4 Planning techniques

Summary

Introduction

Planning in construction

Who plans?

Planning techniques

Other planning techniques

Modern construction planning

Data exchange

Planning multiple projects

Appendix 4.A: Normal probability distribution tables

Chapter 5 Workforce motivation

Summary

Introduction

Motivation theories

Payment systems, remuneration and performance

Chapter 6 Project cost control

Summary

A cost-control procedure for construction works

Systems in current use

Points to consider when choosing a cost-control system

Management of the carbon footprint

Chapter 7 Management of equipment

Summary

Acquisition of plant and equipment

The financing of equipment

Systematic plant selection

The essential characteristics of a decision situation

Setting hire rates

Marginal costing

Plant maintenance

Monitoring of maintenance servicing and exhaust emissions

Section 2: Business management

Chapter 8 Project procurement

Summary

Introduction

The construction process (BS 6079-1:2002)

ISO/BS procurement standards

Appointing the team/parties to the contract

Public contracts and supplies

Project manager/leader

The contract

Health and safety considerations

Categories of contract

Separated and cooperative contracts

Management-oriented contracts

Integrated contracts

Discretionary contracts

Performance of different contract categories

Chapter 9 Estimating and tendering

Summary

Introduction

Parties involved in estimating and tendering

The estimating process

BOQ estimating

Collection and calculation of cost information

Project study

Preparing the estimate

Tendering adjustments

Submitting the tender

Estimating in management contracting

Use of estimating software

Methods of estimating

Chapter 10 Competitive bidding

Summary

Introduction

Part 1: A brief review of bidding strategy

Part 2: The importance of accuracy in estimating

Part 3: Some ways of using the existing theories

Recent developments in bidding

Client evaluation of bids

Chapter 11 Company budgetary control

Summary

Introduction

Preparation of budgets

The carbon footprint

Chapter 12 Cash flow and interim valuations

Summary

Introduction

The need for cash flow forecasting by contractors

The requirements of a forecasting system

Capital lock-up

The factors that affect capital lock-up

Interim valuations and cash flow

Measurement of work in activities

Computers and cash flow

Cash flow forecast by standardised models

Concluding remarks

Chapter 13 Economic assessments

Summary

Introduction

Interest

Economic comparisons

Profitability measures

Inflation

Accuracy of future estimates

Financial modelling

Cost-benefit analysis

Some worked examples

Appendix 13.A: Tabulations of interest and time relationships

Section 3: Administration and company management

Chapter 14 Company organisation

Summary

Introduction

The function of a manager

Company organisational structures

Departments/functions

Health, safety, occupational welfare and pensions

Educational qualifications and vocational training

Corporate Social Responsibility

Management attitude

Chapter 15 Market planning and business development

Summary

Introduction

Market planning

The business-development process

Chapter 16 International construction logistics and risks

Summary

Introduction

The international environment

Conclusions

Chapter 17 Information resources and ICT systems

Summary

Introduction

The construction company’s business

Processes involved in construction business

Information needs to support business processes

Management of contractors’ information resources

Construction information systems

The construction information manager

ICT in construction

ICT change within construction

Enablers of current construction IT

Using ICT resources in construction

Construction in a wireless world

Information security

Chapter 18 Financial management

Summary

Introduction

Types of businesses

Types of capital

The control of capital

The company accounts

Regulatory authorities

Section 4: Self-learning exercises

Chapter 19 Questions – construction management

Questions

Question 1 Method study exercise

Question 2 Time study exercise

Question 3 Time study and activity sampling comparison

Question 4 Site layout exercise

Question 5 Activity sampling of crane operations

Question 6 Activity sampling of labour

Question 7 Crashed activities

Question 8 Networks

Question 9 Planning exercise

Question 10 Resource smoothing

Question 11 Resource allocation

Question 12 Resource allocation

Question 13 Line of balance

Question 14 Line of balance

Question 15 Line of balance

Question 16 PERT

Question 17 Estimating the cost of a formwork panel

Question 18 Estimating the cost of reinforcement

Question 19 Estimating the cost of placing concrete in foundations

Question 20 Estimating cost of placing concrete – operational estimating

Question 21 Estimating cost of laying a 300 mm concrete pipe

Question 22 Hours-saved incentive scheme

Question 23 Bonus scheme with plant

Question 24 Gang bonus payments

Question 25 Control of project costs

Question 26 Budgetary control

Question 27 Cash flow

Question 28 Cash flow

Question 29 Cash flow

Question 30 Cash flow

Question 31 Cash flow

Question 32 Present worth comparison

Question 33 Present worth comparison

Question 34 Equivalent annual cost comparison

Question 35 Discounted cash flow yield

Question 36 Dual rate of return

Question 37 Corporation tax and development grants

Question 38 Corporation tax and different allowances

Question 39 Replacement age

Question 40 Replacement age

Question 41 DCF yield and inflation

Question 42 DCF yield and inflation

Question 43 Present worth with increasing annual costs

Question 44 Present worth with increasing annual costs and inflation

Question 45 Valuation of a plant item

Question 46 Valuation of a plant item with longer life

Question 47 Valuation of a plant item whose life is in perpetuity

Question 48 Selection of mutually exclusive projects using incremental analysis

Question 49 Analysis of plant purchase

Question 50 Setting a hire rate for plant

Question 51 Plant workshop budget

Question 52 Sales variance on plant hire

Question 53 Variances on a plant item

Question 54 Capital gearing

Question 55 Working capital

Question 56 Balance sheet

Question 57 Financial ratios

Question 58 Interpretation of the balance sheet

Question 59 Mass haul problem

Question 60 Development budget

Question 61 Effects of a lease on development budget

Chapter 20 Questions – operational research (OR)

Summary

Questions

Question 1 Linear programming illustrating maximisation

Question 2 Linear programming illustrating minimising

Question 3 Simplex method – constraints: ‘equal to or less than’

Question 4 Simplex method – constraints: ‘greater than or equal to’

Question 5 Simplex method – constraints: ‘greater than or equal to’

Question 6 Integer linear programming

Question 7 Binary integer linear programming

Question 8 Transportation problem

Question 9 Assignment problem

Question 10 Assignment when number of agents and tasks differ

Question 11 Goal programming

Question 12 Non-linear programming

Question 13 Quadratic assignment problem

Question 14 Dynamic programming – batch processing

Question 15 Resources routing – knapsack problem

Question 16 Decision tree problem

Question 17 Utility

Question 18 Markov processes

Question 19 Queuing

Question 20 Simulation

Question 21 Stock control – simple case

Question 22 Stock control – continuous usage

Question 23 Stock control – shortages

Question 24 Stock control – discounts

Question 25 Inventory under uncertainty

Question 26 Theory of games

Chapter 21 Questions – Six Sigma

Six Sigma

Problems (readers should start with Problem 1)

Bibliography

Abbreviations and acronyms

Index

The book’s companion website is at www.wiley.com/go/MCM7 and offers invaluable resources for both students and lecturers:

• Solutions to the self-learning exercises

• PowerPoint slides with discussion topics

• Journal and web references

This edition first published 2013 John Wiley & Sons, Ltd

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Library of Congress Cataloging-in-Publication Data

Harris, Frank, 1944–

 Modern construction management / Frank Harris and Ronald McCaffer with Francis Edum-Fotwe. – 7th ed.

p. cm.

 Includes bibliographical references and index.

 ISBN 978-0-470-67217-4 (pbk. : alk. paper) 1. Construction industry–Management. I. McCaffer, Ronald. II. Edum-Fotwe, Francis. III. Title.

 HD9715.A2H35 2012

 624.068–dc23

2012023206

A catalogue record for this book is available from the British Library.

Wiley also publishes its books in a variety of electronic formats. Some content that appears in print may not be available in electronic books.

Cover image: courtesy of Shutterstock.com.

Cover design by Meaden Creative.

Preface to the Sixth Edition

The book is intended for students and graduates of civil engineering, construction management, building and quantity surveying, and is arranged to reflect site, business and corporate responsibilities embraced by the S/NVQ supervisory and management levels of career development. This approach acknowledges that the modern successful construction engineer, builder or quantity surveyor needs to be a competent technologist possessing complementary skills and knowledge in management as well as understanding the business processes. Armed with such expertise the young construction trainee will be better prepared for decision-making and undertaking executive responsibilities.

The new edition has been guided by the drive for improvement in construction industry performance stimulated through the Rethinking Construction and Construction Best Practice programmes.

Recently restated under the Accelerating Change initiative as committed leadership, client satisfaction, integrated processes and teams, quality management and social responsibility, the opening overview sets out the key points which are subsequently interweaved throughout the text. The construction engineer, builder or quantity surveyor is thereby better positioned to understand and implement modern strategies needed in providing value for money for the client and society.

The book begins by emphasising the important role of total quality management and safe working that now pervades every aspect of construction activity. The subsequent sections are: ‘project production management’ describing the management techniques employed on site; ‘business management’, which addresses the relevant commercial aspects; and finally ‘administration and company management’ covering corporate activities including IT systems and international work.

The processes essential in delivering continuous improvement and meeting performance indicators are especially featured, while the principles of lean construction, concurrent engineering, supply networks, re-engineering, value and risk management are given prominence. The latest contractual innovations, notably design and build, PFI/PPP, term, prime, managing agent, early contractor involvement, framework agreements and alliances, are evaluated, with reverse auctions contrasted with negotiated contracts and detailed pre-selection. Issues for business development and business models, business process outsourcing, matrix management, incentives and plant hire are also treated. In addition, topical concerns on construction productivity, relationship marketing, environment and sustainability, the ‘Kyoto’ protocol, corporate social responsibility, corporate governance, data protection, international construction contracts, investment monitoring and regulation, RFID tagging, health, safety and training are brought to the reader’s attention.

Finally, the comprehensive selection ofworked examples, designed to help the reader consolidate learning, is augmented in this edition by 25 new tutorial exercises dealing with the Operational Research methods, invaluable for analysing the many challenging facets of construction management featured in the contents.

Preface to the Seventh Edition

The book is intended for students and graduates of civil engineering, construction management, building and quantity surveying, and arranged to reflect site, business and corporate responsibilities embraced by the latest national vocational qualifications available for supervisory and management levels of career development. This approach acknowledges that the modern successful construction engineer, builder, commercial manager or quantity surveyor needs to be a competent technologist who possesses complementary skills and knowledge in management as well as understanding the business processes. Armed with such expertise, the young construction trainee will be better prepared for decision making and undertaking executive responsibilities.

Importantly, the new edition directs attention towards achieving a socially responsible, innovative, carbon-reducing, manager-involved, people-oriented, crisis-free, efficient and cost-effective construction industry that competes in an information-enabled environment.

Guided by the drive for improvement in performance stimulated through the Rethinking Construction; Construction Best Practice; and Accelerating Change reports, and more recently by the UK government agenda to achieve Building Information Modelling (BIM) for delivering projects, the key recommendations concerning leadership, client satisfaction, integrated processes and teams, quality management, environmental and social responsibility, cloud operations, and BIM are thus interwoven throughout the text.

The construction engineer, builder, commercial manager or quantity surveyor may thereby better understand and implement the modern strategies needed in providing value for money for the client and society. Particularly, alternative solutions for achieving adequacy in cash flow through invoice financing are provided. Equally, inefficient practices relating to investment decision making, standards and regulation complexity, stakeholder responsibilities, supply chain management, contractual-risk allocation, cost and asset condition data provision as highlighted in the recent Infrastructure UK cost review of delivering construction projects are covered.

The book begins by emphasising the important role of total quality management and safe working that now pervades every aspect of construction activity. The subsequent sections are:

‘project production management’ describing the management techniques employed on site;

‘business management’ which addresses the relevant commercial aspects;

‘administration and company management’ covering corporate activities including ICT systems and international work.

The processes essential for delivering continuous improvement and meeting performance indicators are especially featured, while the principles of lean construction, construction industry productivity, environmental management and sustainability are given prominence.

The latest innovations, notably procurement standards and contractual legislation, early/optimised contractor involvement, framework agreements, PFI funding, Building Information Modelling, Stakeholder Management, Corporate Social Responsibility, and the carbon footprint are also treated. Additionally, topical concerns on education and training, energy conservation and productivity, investment monitoring and banking regulation, occupational health and social welfare provision in the workplace, incentive payments for executives and senior managers, design coordination, web-based marketing, smart phone and tablet computer applications, working in a cloud-enabled construction industry, waste management, and the latest conditions of contract are brought to attention.

Finally, the comprehensive selection of worked examples designed to help the reader consolidate learning, is augmented in this edition by fifteen new tutorial exercises dealing with the Six Sigma process, invaluable for analysing the many challenging facets of construction management featured in the contents.

Frank HarrisRonald McCafferFrancis Edum-Fotwe

Chapter 1

Introduction

Modern management in construction addresses four principal areas of the industry:

Management of the physical production phase or site construction management;

Management of the various functions that make up and contribute to the delivery of projects, or total project and programme management;

Management of the corporate establishments involved in the delivery of the constructed facilities and services or organisational management;

Management of the industry to create an enabling commercial, regulatory, and conducive socio-economic environment, or sector management.

Construction Management addresses the effective planning, organising, application, coordination, monitoring, control and reporting of the core business processes of marketing, procurement, production, administration, accounts and finance necessary to achieve economic success and/or profitability for an enterprise or organisation engaged in the provision of construction facilities. The function may be performed by a client, contracting company, consultant firm, public body or combination of such stakeholders contracted to bring a project or series of projects to safe completion on time, to budget, to the set quality and expected innovative, aesthetic, socially responsible, and environmental impact.

Construction Project Management focuses on the delivery of a specific solution by contracting with stakeholders who undertake combinations of the following indicative sub- processes relating to a specific project:

Scoping and budgeting the project;

Design coordination/management;

Establishing the management structure of the management team;

Marketing and procurement;

Defining roles and responsibilities;

Estimating and tendering;

Stakeholder management;

Project and construction methods planning, coordination and control;

Value and risk management;

Organising, leading and implementing controls;

Production and productivity management;

Management of labour resources, temporary works provision, equipment, plant, subcontractors and suppliers;

Time and subcontractor interface management;

Cost and budgetary control, including cash flow forecasting;

Quality management;

Contract and progress payments administration;

Legal issues;

ICT management;

Health and Safety management, education, training and welfare provision;

Corporate Social Responsibility;

Management of the potential environmental impacts of construction;

Commissioning, auditing and recording of the project(s).

Also see CIOB definitions of Construction (Project) Management.

Significantly, as recent Constructing Excellence (CE) and government reports emphasise, the marked shift towards modern forms of contracting, rapid technological change, and greater environmental, social and economic accountability of construction pose ever-growing competition in a world of intensified global trading – not least the Corporate Social Responsibility (CSR) notion of ‘doing well by doing good’ to enhance competitive advantage. Hence an intelligent client will increasingly need to focus on achieving value at the operational and business levels through the appointment of a robust integrated ‘best in class’ supply chain of stakeholders, able to deliver the listed project services with the fresh, practicable, robust, measurable and auditable core competences and management processes described and explained in this seventh edition of Modern Construction Management.

Structure of the Book

The book covers the principal responsibilities of Construction Management divided into four main sections; in addition, Chapters 1 and 2, which do not form part of the main sections, give specific consideration at the outset to the philosophy of the book as a means of explaining the succeeding chapters. In particular, Chapter 2, which covers quality management in construction, is used to illustrate how quality is intertwined as a thread running through all the subsequent sections. It also explores the emerging strategic role of quality as a driver for competitive advantage in construction.

Section 1 deals with techniques relating to project production management, including environmental legislation guidelines.

Section 2 treats the business aspects of management at both project and company levels.

Section 3 addresses the executive management responsibilities for overall corporate control.

Section 4 brings together a selection of self-learning problems complemented with complete worked solutions for use in the classroom environment, tutorial exercises and seminar discussions, which are provided on the companion website.

The reasons for this particular presentation are:

(1) Successful construction industry executives have distinct phases in their careers: the initial period is spent on site, followed by middle-management duties at the project level, culminating in a career with executive head-office activities. The sections are intended to cater for these phases.

(2) The construction industry is inherently uncertain as a result of the nature of the industry itself – the competitive tendering process, the company’s turnover, site production rates and the weather are all features that are characterised by variability and a degree of uncertainty. To be able to cope with such uncertainty, construction executives need to be acquainted with the relevant knowledge and tools for addressing these features. The management techniques described in this book help reduce variability and thus provide the basis for sound and effective decisions by aspiring executives. For example, with proper planning, the duration of a project is not just an experienced guess. The inevitable residual variability in even the best-run company needs to be controlled by:

(a) Planning and setting targets

(b) Choosing methods to achieve such plans and targets

(c) Monitoring progress

(d) Taking corrective action when necessary.

This continual monitoring and revision is ultimately the only way to cope with uncertainty and variability.

Objectives and Contents

Each chapter deals with a specific topic (which could, if exhaustively treated, form the basis of a whole book; suggestions for further reading appear at the end of chapters).

The level of detail aimed at is that which will provide the reader with a basic working knowledge of the topic, rather than with specialist expertise. For example, the planning section of the book explains the major techniques available for planning both repetitive and non-repetitive works in sufficient detail to allow intelligent engineers to apply them, providing sufficient comprehension for them to converse sensibly with a specialist support group such as a planning department. Engineers and builders need enough knowledge to understand, appreciate and, where necessary, question the work of specialist support staff such as accountants, cost clerks, planners and plant managers. A grasp of the techniques described in the sections should help in achieving this skill. Specialists must not be allowed to hide safely in their own specialisms. Participation in the exercises in Section 4 provides a deeper and better understanding of the implications of the various techniques. Section 4 largely covers the numerical-based aspects of these techniques.

Chapter 2. Quality management in construction provides the platform for the succeeding chapters and describes the evolution of quality management from quality control through quality assurance to total quality management, as well as the current standards employed by construction organisations. It also looks at quality from the project perspective, advocates a concerted effort by both client and contractor to make any quality agenda a reality, and explores a systems approach to attaining such an agenda.

The contents of each section are now discussed briefly below.

Section 1

Section 1 relates specifically to project production management, including planning techniques, production process improvement, estimating and tendering, workforce motivation and cost control.

Chapter 3.

Production process improvement:

covers energy use and the environment, Carbon Reduction Commitment legislation, national productivity reports, quality management, lean construction, benchmarking, stakeholder management, Corporate Social Responsibility, Six Sigma, production measurement and sampling, waste management.

Chapter 4.

Planning techniques

deals with the principles of the techniques used in planning repetitive or non-repetitive construction work. The chapter describes bar charts, linked bar charts, network analysis and line-of-balance scheduling, PERT, space–time diagrams and The Last Planner. The role and use of computers in planning and the requirements of computer systems in exchanging data are also described. The chapter is updated with pertinent material on managing multiple projects.

Chapter 5.

Workforce motivation

links the use of incentive schemes to motivation theory. It also presents the various payment systems for non-financial, semi-financial and purely financial incentives that can be employed to enhance worker motivation.

Chapter 6.

Project cost control

gives guidance on the various cost control methods available, including profit-related control systems, unit and standard costing approaches, cost monitoring of subcontractors, and cost management of carbon emissions.

Chapter 7.

Management of equipment

considers the financing of plant and gives guidance on plant selection and control of gaseous emissions. Calculating a hire rate and maintenance procedures are also covered.

Section 2

Section 2 presents business management topics and is intended to assist project-based staff to understand and appreciate the company’s attitudes and activities, easing the transition from site to general management. The topics described relate to procurement, bidding, budgets and cash flow, economic assessment and plant management.

Chapter 8.

Project procurement:

introduces the role of project management and design coordination, and reviews various forms of contract including EU regulations for public contracts. The latest developments for procuring construction and engineering embraced in the ISO and BS Procurement standards and codes of practice, design and build, early and optimised contractor involvement, modern PFI, partnering and associated funding mechanisms are also explained.

Chapter 9.

Estimating and tendering

describes the current nature of estimating practised by main and work-package contractors. It describes parties involved in the estimating and tendering process for work packages and outlines the process, including the decisions and calculations involved, and the issues in costing materials and subcontractors. It also addresses the use of computers in estimating and the changing role of the estimator in the face of advances in information technology.

Chapter 10.

Competitive bidding

examines the effect of estimating accuracy, which implies the need for more resources in the estimating department, reviews how to interpret the various available items of data relating to competitors’ behaviour and comments on improving estimating accuracy. It also covers electronic bidding and fundamental information on bid evaluation.

Chapter 11.

Company budgetary control

deals with the preparation of budgets and controlling costs for a company or enterprise, including budgeting for the carbon footprint.

Chapter 12.

Cash flow and interim valuations

illustrates company cash-flow forecasting and provides guidance on how to do this type of forecasting, the use of computers in cash-flow calculations, the process of interim valuations and the relationship between interim valuations and cash flow. It introduces the concept of invoice financing as a means for achieving positive cash flow for the construction company.

Chapter 13.

Economic assessments

describes the principles employed in economic comparisons and in measuring rates of return, life-cycle costing, cost–benefit analysis and financial modelling. It also provides an introduction to the use of multi-criteria analysis for appraising projects.

Section 3

Section 3 presents the executive management responsibilities largely concerning head-office activities, including organisation, business development, global construction, the emerging role of information as a major construction resource and finance.

Chapter 14.

Company organisation

contains a description and explanation of company structure, organisation and managerial responsibilities, including training and vocational qualifications.

Chapter 15.

Market planning and business development

describes a marketing approach to construction and the benefits likely to be derived and methods of selling including modern web blogging and social networking.

Chapter 16.

International construction logistics

provides an overview of the problems in globalisation of trade, raising finance, dealing with unfamiliar conditions of contract and legal systems, transport of goods, payment procedures and local labour, resources and security.

Chapter 17.

Information resources and IT systems

develops an understanding of the strategic role played by information resources in managing both projects and the business for organisations in the construction industry including the cloud resources. It also addresses information systems and its associated technology embracing email, web sites, intranets, on-line information data and transfer, data exchange and integration of systems, as well as an introduction to Building Information Modelling.

Chapter 18.

Financial management

describes the sources and means of acquiring capital funds and the use of balance sheets and profit-and-loss accounts and financial regulation.

Section 4

This section presents 87 tutorial examples with complete worked solutions for students in construction disciplines. It is separated into three chapters, with the first, Chapter 19, covering the worked examples from Chapters 3 to 18. Chapter 20 provides worked examples on operational research techniques. Chapter 21 similarly introduces Six Sigma statistical examples supportive of Lean Sigma application to productivity improvement analysis. The solutions are available on the companion website.

Students learn by reading texts and attending lectures. However, they need to test their new-found knowledge or skill by attempting to work through example problems, and several textbooks are available that offer such examples, either with or without answers. Where an answer is provided, the student’s own answer is frequently at variance and they are then faced by a dilemma: is the textbook in error or has the author made different, but valid, assumptions? In this book, a complete worked solution to each example is given so that the student has full guidance through the analysis.

The topics covered in Section 4 are those aspects of construction management that may be treated numerically:

Production analysis;

Planning;

Estimating;

Motivation schemes;

Control of project costs;

Budgetary control;

Cash-flow forecasting;

Discounted cash flow;

Investment analysis;

Plant management;

Setting of plant-hire rates;

Financial management;

Development economics;

Construction methods;

Operational research;

Six Sigma for construction.

The intention is for the students to test their knowledge by trying the examples and comparing the solutions with those offered in the book. Any differences between the student’s solutions and those presented here may be discussed with the tutor, and in this way tutorial discussions may be used advantageously for resolving difficulties rather than for routine learning.

It should be remembered that these are tutorial examples and that each one deals with a limited number of variables and principles, sometimes making simplifying assumptions. Thus, students may test their understanding of the principles and ability to manipulate the variables.

Chapter 2

Quality Management

Summary

Quality control, quality assurance, total quality management, and systems quality in construction.

Introduction

Quality management has seen a transition from reacting to the outcome of site production activities to become a strategic business function accounting for the raison d’être of construction companies. Unless a construction company can guarantee its clients a quality product, it can now no longer compete effectively in the modern construction market. Crucial to the delivery of such quality products is the quality of processes that produce the product. ‘Quality’ now stands alongside ‘price’ as a major factor of differentiation in contractor selection by the client as well as determining the efficiency of processes that the contractor adopts for site operations. To be competitive and to sustain good business prospects, construction companies need a more strategic orientation for the quality systems they deploy.

This chapter focuses on the transitions in quality management for construction companies culminating in a systems outlook for managing quality in construction. Quality management has to provide the environment within which the tools, techniques and procedures presented in the other chapters can be effectively deployed leading to operational success for the company. The role of the quality management for a construction company is not an isolated activity, but intertwined with all the operational and managerial processes of the company. This chapter reviews various concepts associated with the quality and then considers the contributions of quality control, quality assurance and total quality management to the quality of construction. It also addresses the growing use of quality management systems for achieving superior performance in construction. It highlights the fact that quality in construction can be achieved only through the direct effort of all stakeholders of the project.

Notions of Quality

The management of quality in construction is an area of specialisation that has been growing over the past three to four decades to embrace aspects of the project and company activities that are often seen as remote from the physical product. Fig. 2.1 shows various concepts that are considered to have an influence on the quality of the product and which have come to be associated with quality in construction.

Fig. 2.1 Aspects of construction quality.

The various areas that contribute to quality in construction in reflect the product features, the processes of production and organisation, as well as wider company and industry/business issues. In particular, the management of quality in construction has been embracing considerations that address more of the pre-production processes and organisation/industry issues. For example, a company’s quality status is not just seen in isolation, but increasingly from the perspective of industry-wide standards and against that of its competitors.