Construction project

management
Course code: 9AR02
 1. INTRODUCTION
A. Importance of construction and construction industry
i) It is an integral part of infrastructure development like houses,
offices, townships, schools, hospitals, urban infrastructure (water
supply, sanitation), highways, ports, railways, airports, power,
irrigation, industrial infrastructure, etc.

ii) Construction is the basic input for socio-economic development.

iii) Employment- It employs engineers, managers, skilled workers,

unskilled workers from rural and urban areas.

iv) It is dependent on other industries and hence its growth propels

the growth of other related industries. E.g. Cement industry,
equipment industry, sanitary hardware industry, and steel industry,
paints, chemicals, aluminium, glass, etc.

v) Multiplier factor between growth rate of construction industry and

the country’s GDP is 1.5 to 1.6.
 1. INTRODUCTION
A. Construction industry in India
i) Second largest industry next to Agriculture industry. It provides
employment to 33 million people.

ii) Integral part of country’s infrastructure and Industrial development.

iii) It contributes more than 5% to the nation’s GDP. Hence vital for
overall growth of Indian economy.

iv) Performance or execution of construction projects in India have not

been very encouraging due to Time and cost overrun’s and disputes in
various contracts.

v) Present GDP growth rate of India: 7.2% annual change (as on 2022)

Note: GDP stands for "Gross Domestic Product" and represents the total monetary value of
all final goods and services produced (and sold on the market) within a country during a period
of time (typically 1 year).
 1. INTRODUCTION
• Infrastructure management or infrastructure creation is an
integral part of development; especially in developing countries
like India.

• It can be the design and construction of roads, airports,

Hospitals, industries, etc. or any development to cater to the
nations needs.

• Large scale construction activities are involved in many projects

like:
- Roads and railways (Transportation infrastructure)
- Power plants (Energy sector)
- Industrial construction (Refineries)

We are concerned primarily with the construction phase of these

projects
 Interdisciplinary nature of modern
construction projects
• Urban built environment in 21st century is focusing
on various infrastructural aspects like commercial
buildings, metros, airports, etc.

• Accordingly modern infrastructure projects are

getting increasingly interdisciplinary in nature in that
they span several disciplines of engineering.

• As a manager of these projects, a certain level of

awareness and knowledge of diverse issues is
required.
Interdisciplinary nature of modern
construction projects
Interdisciplinary nature of modern
construction projects
Interdisciplinary nature of modern
construction projects
Interdisciplinary nature of modern
construction projects
Interdisciplinary nature of modern
construction projects
 1. INTRODUCTION
Every construction project is:
• Is unique because of:
 It is a one time activity
 High cost and time for execution
 Local conditions.
 Complexity – It is multidisciplinary due to involvement of set of interrelated tasks
to be done by experts.
 Uncertainty and High risk of failure
 People involved in construction process and their relationship.
 Difficulty in defining quality standards.
 Untrained workforce. Difficulty in getting trained workforce.
 Equipment and materials involved.
 Type of project and its design.

• Involves a commitment of a huge amount of resources in terms of funds, manpower,

materials, equipment and time.

• It can easily span over several months and sometimes several years.

• Hence, due to this proper planning needs to be done as to what kind of resources (in
terms of equipment, manpower, etc.) is needed at different points of time as the
project progresses.
 1. INTRODUCTION
Stakeholders in a construction project:
 1. INTRODUCTION
Stakeholders in a construction project:
1. Client: The owner of the facility. For e.g. For a road
Project, NHAI (National Highway Authority of India) or the State
government.
• The client does not necessarily need to have the expertise to
design the project.
• The client has to have a designer who will actually carry out the
design.
2. Designer: The company or a set of people who actually
design the project. For e.g. Architect called to design a
multi-storey mixed use development.
• The design could be functional, aesthetic or structural.
 1. INTRODUCTION
Stakeholders in a construction project:

3. Contractor: The agency which actually carries out the work. They
do the execution or construction of the project.

4. Investor: They are the banking or finance institutions who also

invest capital in a project. E.g. PPP model –The Public –Private
partnership model in which the funds for the projects are not being
provided by the government but by the investors.
 1. INTRODUCTION
Stakeholders in a construction project:

5. Regulator: They are the government agencies who are charged

with the responsibility of ensuring that the design, the construction
and the operation is done as per an existing or in agreed guideline
or a specification. For E.g. i) ISI-Indian Standards Institution lays out
many standards and codes of design of concrete elements in
construction like column, beam, etc. like IS-456 and SP 16.
ii) The T & CP or Municipal corporation or UDA (Urban
Development Authority) regulates the development of land in any
town or city by prescribing minimum recommendations like offsets,
FAR, Height of building, etc. for sanctioning of plans of any project.
 Assignment 01
1. List out the stakeholders for the following projects:
– Chemical industry
– Institutional or educational campus
– Public library

2. Study and collect the details of metro system in any

three cities. Details may include:
– Important stations in the network
– Total length of the metro
– Total number of special structures in the station.
– Average passenger traffic in a day/station.
 2. Construction organization
A. Construction company - common functions:
• General administration
• Estimating and costing
• Managing contracts and personnel
• Design and engineering,
• Purchasing/procurement
• Accounting and managing field construction

• The organization of a construction company is the conceptual

framework of resources that carries out the above functions.

• The above functions involve other stakeholders also like,

engineers, contractors, manufacturers, material suppliers or
vendors, equipment distributors, labour, government
agencies, etc.
 2. Construction organization
Construction company - common functions:
Two fold aim-

• To divide responsibility according to technical knowledge and

by degrees of executive ability.

• The extent to which authority and work responsibility is

delegated is an important feature of any organization.

• Authority – power to take decisions for other to follow.

• Responsibility- obligation to effectively perform assignments.

• Accountability- being totally answerable for the satisfactory

completion of a specific assignment.
 2. Construction organization
B. Forms of business organization:
i) Sole partnership
ii) Partnership
iii) Private Limited Company
iv) Public Limited Company
v) Government Enterprises
vi) Joint Ventures
 2. Construction organization
B. Forms of business organization:
i) Sole proprietorship-
• Owned by a single person.
• Owner has government license to run his set up.
• Widely used in service industries like Hospitality, Travel (flight), Media,
Entertainment, Healthcare, Wellness, etc.
• Earnings by such organizations are subjected to personal income tax
and not corporate income taxes.
• Owner has unlimited personal liability for debts.
• Organization lasts as long as the owner lasts.
 2. Construction organization
B. Forms of business organization:
ii) Partnership-
• Involves two or more persons.
• Freedom from special government regulations.
• Profits generated out of business are taxed as personal income tax in
proportion to the partner’s claim.
• Old partnership ceases in case a new partner joins the business.
• Major disadvantage is impermanence and difficulty in transferring
ownership and unlimited liability.

iii) Private limited company:

• It is a firm which offers limited liability to its shareholders.
• It places certain restrictions on its ownership which are spelled out in the
firm’s ‘articles of association’ or byelaws to prevent any hostile takeover
Attempt by any of the shareholders.
• Shareholders cannot sell or transfer their shares without offering them first to
the other shareholders for purchase.
• Shareholder cannot offer their shares to the general public over a stock
exchange.
• Number of shareholders cannot exceed a fixed figure (commonly 50) as per
Company Act.
 2. Construction organization
B. Forms of business organization:
iv) Public limited company-
• It is also a limited liability company whose securities or shares are
traded on a stock exchange (national, regional and international) and
can be brought and sold by anyone.
• Such companies are strictly regulated by law and are required to
publish their complete and true financial position so that investors can
determine the true worth of its stock.
v) Government enterprises:
• It can be a government owned corporation, a state owned enterprise or a
government business enterprise.
• It is a legal entity created by a government to undertake commercial or
business activities on behalf of government.
• They have a distinct legal form and are established to operate commercial
affairs.
3. Structure of Construction organization
Organizational structure-
• It deals with how to utilize basic resources, people and how to facilitate
overcoming the communication barriers at organizational level.
For e.g. It indicates the arrangement of different departments and the
division of labour.
• Such an arrangement has a bearing on the response time for delivering
decisions.

• It is very rare for any two construction companies to have an exactly

similar kind of organizational structure.
• Even for the same construction company, the organizational structure
may not remain the same over a long period of time.
• The organizational structure of any company keeps on evolving and it
depends on a number of factors like technology, complexity, resource
availability, products and services, competition and decision making
requirements.
3. Structure of Construction organization
Types of construction organization:
• Line type organization
• Line and staff organization
• Functional organization
3. Structure of Construction organization
i) Line type organization:
• This type of organization is commonly found in small construction
firms involved in simple construction assignments with little
complications and which is basically labor intensive.
• The line of authority is direct from one level to another level of
hierarchy.
• Such assignments are executed with the direct involvement of the
owner, with the help of managers/supervisors.
• These supervisors were directly overseeing the works carried out
by their subordinates.
• The communication is essentially vertical in such an organization.
For e.g. Owner will command the manager/supervisor, who in turn will
command the foreman 1, 2 and 3. The foreman in turn will command
the workers directly under them. Foreman 1 will command workers 1
and 2. Foreman 2 will command workers 3 and 4 and so on.
• There is negligible horizontal flow of communication. E.g.
Foreman 1 will neither receive nor issue any orders to foreman 2.
3.
i)
Structure of
Line type organization:
Construction organization
Advantages:
- They are the easiest to establish
- They are one of the simplest to explain to employees.
- In this structure, there is a unity of control.
- There is a strong sense of discipline.
- Each employee is assigned a fixed role and responsibility.
- Decisions can be quickly taken and the organization can adjust to changing needs
in no time.
Disadvantages:
- There is a lot of expectation from the person holding authority.
- The efficiency of the structure is heavily dependent on the person in authority.
- The advice of a smart employee at the bottom of the hierarchy may go unheeded
as there is no communication from an employee belonging to a lower hierarchy.
- The structure suffers from lack of specialized skill of experts. For e.g. Foreman 1
may not be skilled in all aspects of work, yet, he is supposed to give guidance to
workers 1 and 2 under him.
Line type organization
3. Structure of
ii) Line and staff organization:
Construction organization
• Suitable for bigger projects
• It includes specialists or experts as staff members to guide the line managers
(foreman) in performing their duties. For e.g. Manager safety plays the role of staff
in the di
• The role of staff members is purely advisory as they can only give recommendations
but do not have authority to implement those recommendations.
Advantages:
• Line employees are responsible for execution while staff employees play the
advisory role.
• Line and staff structure offers ample opportunity for the growth of employees. It
also offers good training opportunity to the employees.
• The quality of decisions arrived at in a problem situation is high, as careful thought
is given to arriving at the decision.
Disadvantages:
• There is a lack of well defined authority structure.
• The structure is mostly suitable for large organizations where there is constant need
for employing people with specialized skills.
• There is always a possibility of a conflict arising due to differences of opinion among
the staff and managers.
• It is difficult to distinguish between line and staff functions.
Line – staff type organization
Line – staff type organization
3. Structure of Construction organization
iii) Departmental or functional organization:
• With increase in size and complexity of projects, even the
line and staff type organization fails to deliver.
• This is because the L-S type organization tends to load a few
men at the top of the hierarchy with more duties than they
can handle efficiently.
• This gave rise to departmental organization.
• It has departments with department heads who have the
control of functions allocated to them and are free to
communicate directly with the field employees.
• In such an organization, the top hierarchy people are relieved
from the heavy burden.
• It can be seen as the best combination of line type and line-
staff type organization.
• It also leaves the functional managers in direct charge of the
work and ensures them the support of a highly trained
technical staff.
Functional type organization
 Assignment 02
1. Make a list of any 5 construction projects in
increasing level of scale and complexity and
then identify and categorize them under
either:
i) Line type
ii) Line-staff type or
iii) Functional organization.
 Unit-II- Construction planning and
scheduling
• Life cycle stages in a construction project

• Construction Project planning

– WBS (Work Break down Structure)
– Project Networks (& techniques)

• Construction Project scheduling

• Construction Project controlling and

monitoring
 Stages in a project

1. Concept: A requirement based on a need. E.g. A road to connect point A to B.

2. Planning: A plan to achieve the need. For e.g. There could be multiple routes to connect
points A and B. Deciding on the shortest distance connecting between A and B and other
geographical features like a river, topography, etc. and its feasability.

3. Designing: Working out the specific details based on the information gathered in the
planning stage and coming up with an appropriate design.
 LIFE CYCLE

IOD (Intimation of Disapproval)- It states conditions that needs to be compiled with during different
phases of an under construction project. It is also known as building permit.
Construction planning
 Unit-II- Construction project planning
Construction project planning involves:
• Defining scope of work
• Identifying activities involved
• Defining the work tasks
• Estimation of duration of individual tasks
• Identification of interdependencies among
different tasks
• Establishing project duration
• Estimation of required resources
• Defining procedures for controlling and assigning
resources
• The choice of technology
1. Defining scope of work
• Scope is to be defined completely as all project
activities involve resources.

• Any addition or deletion or modification in the

scope can have serious repercussions in terms of
time of completion and cost and lead to litigation
(legal complications) leading to souring of
relationships between different agencies or
stakeholders involved.

• E.g. If felling of trees and getting environmental

clearances is added (at a later date) to the scope
of a contractor who has been awarded a job for
construction of roads, it would obviously cause
difficulties.
2. Identifying activities/tasks involved
• Listing and defining activities along with the
resources required
For a Road construction project
4. Identifying interdependence
among different tasks or activities
5. Establishing project duration
• This can be done only with a clear knowledge
of the required resources, productivities and
interrelationships between activities.

• This information is used to prepare a project

network or a project schedule.

• Time duration of an activity is directly related

to the resource commitment. It is possible to
reduce the project duration by increasing the
resource commitment even at additional cost.
6. Defining procedures for controlling
and assigning resources
• This lays down the procedures for procurement
and control of resources for different activities
like manpower, machines, material and money

• A MIS (Management Information System) for

compiling and reporting of all construction
planning data needs to be used. E.g. Software like
Primevera, MS-Project, etc.
Resource management in construction
projects

Resources in a construction project

• Materials
• Machinery and consumables
• Manpower
• Money
Types of project plans
 Types of project plans
1. Time plan: Common reasons for delays in any
construction project are:
– Delay in award of contract (to contractor)
– Alterations in the scope of work leading to changes
during execution of project
– Delays in payments
– Slow decision making
– Delays in supply of drawings and materials
– Labour protests, etc.

• Several tools and techniques are available for

Time planning like Bar charts, CPM networks,
PERT networks, etc.
A Bar chart schedule for Time planning
 Types of project plans
2. Finance plan:
Contractors fund their projects from their
working capital, which they have raised from
their own funding sources like
• Banks loans
• Mobilization advance for the project
• Running account bills paid by client
• Advance payments
• Credits from suppliers against work done
Types of project plans
Work breakdown structure (WBS)
WBS -Example
WBS -Example
WBS- Alternative for same project
Exercise 1-Road construction project

Time
(in days)
3
5
5
6
5
7
6
7
Exercise 2-
Exercise 2-
WBS of an IT Park Project
 2. Construction Project Scheduling
techniques
• Bar charts

• Project networks (& techniques)

– Critical Path Method (CPM)
– Program Evaluation Review Technique
(PERT)
 Bar charts
• It is a simple representation of a project in
terms of the ‘jobs’ or ‘activities’ to be
performed and the ‘time’ taken to complete
those activities.
• ‘Activities’ are represented on Y-axis and
• ‘Time’ taken for activities is represented on
X-axis.
 Bar chart
1. Identify the activities
2. Identify precedence relationships-
• Which activity should precede which
activity?
• Which activities can run parallelly?
3. Assign time duration for each activity
BAR CHART
 Limitations of Bar charts
• They can be used only for small projects.
• Progress of work cannot be monitored
scientifically.
• Delays in work cannot be detected.
• It does not indicate the critical activities in the
project.
• It gives some idea about the physical progress of
the project. But the financial aspect involved is
not known i.e. whether the project cost is within
the estimated cost or exceeded.
• It is only a simple representation to give an
overall general view of the project. Hence it
cannot be used as a controlling device by the
project manager to take timely action.
 Numerical –Bar chart
For the construction of a guest house, certain activities have to
be performed, which are given below:
Activity Duration
(in weeks)
A 2
B 3
C 5
D 4
E 2
F 3
G 5

Activity B and C can be performed simultaneously and can start only when activity A has
been completed. Activity D can start only after activity B ends. Activity E cannot begin
until activity B and C are completed. Activity F can start only after activities D and E are
completed. Activity G can commence only after completion of activity E.
i) Prepare a bar chart for the project.
ii) What is the total time taken for the completion of the project?
Exercise 1-Road construction project

Time
(in days)
3
5
5
6
5
6
5
7
A Bar chart schedule for Building Construction
 Exercise 3
• Prepare a bar chart for the construction
of a 2 storied residence.
– Identify the activities
– Identify precedence relationships
– Assign time duration for each activity
– Draw a bar chart for the above project
 Network fundamentals
Network: A network consists of nodes and
arrows which are graphical representations of
activities.
• They show the logical dependance between
the different activities.
For E.g.
A-Casting of column
1 2
Network fundamentals
Network fundamentals
Network fundamentals
Network examples
Network examples-AON network
Network examples-AOA network
Basic rules for drawing networks
Checks applied while drawing
networks
 Network logic
1. Activity Predecessor B
A
1 2 3
A -
B A

1 A
2. Activity Predecessor C
3 4
A -
B - 2 B

C A, B

3
3. Activity Predecessor B
A
A - 1 2 C
B A
4
C A
Network examples-AOA network
Network examples-AOA network
 Network logic
1. Activity Predecessor 1 A C 4
A -
3 D 6
B - B
2 5
C A, B
D A, B

Alternately

3 C
2. Activity Predecessor A
A - 4
1
B - B D

C A, B 2

D A, B
Network examples-AOA network
Network examples-AOA network
 Network logic
Activity Predecessor 2
1. D
A - A
B - B
1 3 5
C -
C E
D A
E B,C 4

2 D
Activity Predecessor
2. A
A -
B
B - 1 3 5

C - C E
D A,B 4
E B,C
 Network logic
3. Activity Predecessor
2 C
A -
A
B - D
1 3 5
C A, B E
D A, B
4
E B

4. Activity Predecessor
2 D
A -
A
B - E
B
C - 1 3 5

D A C F
E A,B, 4
F A,B,C