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Construction Productivity Productivity Measurement and Benchmarking

Construction productivity

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A detailed presentation on construction Productivity in India

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Page 1: Construction productivity

Construction Productivity

Productivity Measurement and Benchmarking

Page 2: Construction productivity

Productivity By popular definition productivity simply refers to the general

efficiency of an organization or individual

The output of any aspect of production per unit of input

Economic measure of output of a worker, machine, or an entire national economy in the creation of goods and services to produce wealth

In the business world, productivity measures investment in capital, such as buildings, machines, raw materials & in labour against the profits from the sale of the product

Page 3: Construction productivity

Productivity A company that most minimizes input and maximizes output has the

highest productivity

A total concept that addresses the key elements of competition i.e. innovation, cost, quality and delivery

Should be viewed as value adding in addition to optimizing

Construction is a labour intensive process

Manpower is one of the productive resources in construction

Construction productivity largely depends upon human performance

Reliable measures of productivity is output per work-hour being achieved by workers

Page 4: Construction productivity

Why is Productivity Important? Extremely vital performance measurement tool within the

construction industry

Due to size of construction industry productivity trends carry immense consequences for the economy as a whole

Productivity growth is important to an individual enterprise, an industry or an economy

Construction industry accounts for 3 – 8% of the GDP in most countries

Page 5: Construction productivity

Why is Productivity Important? Productivity improvement in construction industry may

have a significant impact on improving GDP

Productivity growth is the key determinant of international competitiveness in the long term

Improving relative productivity growth improves a country’s competitive position

The construction industry – most challenging and demanding still many opportunities for productivity improvement

Page 6: Construction productivity

Factors Affecting Construction Labour Productivity Project uniqueness

Technology

Management

Labour organization

Real wage trends

Construction training

Page 7: Construction productivity

Factors having adverse effect on productivity Overtime and or Fatigue Errors and omissions in plans and specifications Multitude of change orders Design complexity and Design completeness Stacking of trades Dilution of supervision High accident rate Jurisdictional disputes Work rules and restrictive work practices Availability of skilled labour Reassignment of manpower from task to task Material location – above ground level/above floor level Adverse temperature or weather Inadequate lighting

Page 8: Construction productivity

Regulations of various types High absenteeism High turnover Material shortages Ground water level Attitude of the workforce Crew size and composition Economic conditions & level of unemployment Size and duration of the project Timeliness of decisions Impractical QA / QC tolerances Uncontrolled breaks Time of the day & day of the week Inadequate temporary facilities: parking, change / rest rooms etc

Page 9: Construction productivity

Quality and Productivity Folklore True Relationship Outmoded relationship Modern view of Relationship

QualityQuantity

Quality

Quantity

Improvement of Process – TQM

Leads to greater uniformity of product

Reduces mistakes and rework

Reduces waste of manpower, machine,time and materals

Increases output with lowered cost

Other Benefits

Better competitive position

Happier people on the job

More jobs

Improved morale

Page 10: Construction productivity

Quality and Productivity Deming’s Quality Chain Reaction

Quality

Customer Satisfaction

Market Share

Productivity

Prices

Costs

Profits

Improve Quality Costs decrease because of less rework, fewer mistakes, delays, snags, better use of machine, time and materials

Productivity improves

Page 11: Construction productivity

Productivity and Safety Worldwide – construction industry produces more injuries than other

industries

Construction industry – often criticized for poor performance (low productivity, waste, health and safety problems)

Strongest relations exist between work organizational factors, working conditions & health & absenteeism

Research shows that occupational safety and health improved (less health complaints and less accidents) when working conditions and work organization ameliorated

Improving safety improves productivity

Page 12: Construction productivity

Methods of Improving ProductivityThe following factors can lead to the improvement in productivity: Training programs for labour Incentives in contract for good performance Enough tools in working place and proper planning Optimizing site facilities Availability of resources Competition between crews, areas or shifts Good supervision and optimum manpower Short interval scheduling Innovative materials and equipment Time lapse film analysis for critical activities Cost reporting and work sampling of critical activities

Page 13: Construction productivity

Time and motion studies to improve efficiency, reduce fatigue and work smarter

Safety programs Use of precast and prestressing concrete elements Critical path method of planning, scheduling and control Value engineering Worker motivation programs Constructability review of design Standardization Preplanning activities Effective utilization of sub-contractors

Page 14: Construction productivity

Productivity CalculationInputs OutputWork hours Value of work (Rs)

Quantities

Equipment

Rupees

Materials

Energy

Capital

Conversion Factor

Page 15: Construction productivity

Models of Productivity Economic Model

TFP = Total Value of Output / Total Value of Input

= Output (Rs) / Input (Rs)

Where TFP is the total factor productivity and

Input = Labour + Material + Equipment + Energy + Capital

Project Specific Model (Construction)

Productivity = Output (Activity unit) / Input (Rs) = Sq. mts / Rupees

Page 16: Construction productivity

Activity Oriented Model Measured in terms of Labour Productivity Can be measured in two ways: a) Output / Input or b) Input / Output Input can be in terms of Cost or Man hours and

Output can be in terms of Unit of work performed Generally the second model i.e. Input / Output is

used to measure the productivity but again the choice depends on the monitoring party

Page 17: Construction productivity

Input and output being the same the productivity comparison depends on the following factors Size of the Job Material Availability Schedule of Activities Connection or interlinking of activities Support operations Location

Therefore a comparison of productivity can only be made if the conditions are similar and also the activities are similar.

Page 18: Construction productivity

Major causes leading to poor productivity

Congestion Sequencing Lack of materials

A high variability in the unit productivity value is an indication of poor productivity and a low variability indicates good productivity

Page 19: Construction productivity

Productivity Benchmarking Benchmarking is a systematic process of searching for the best

practices, innovative ideas and highly effective operating procedures that lead to superior performance

Purpose of Benchmarking a) Analyze the operations to - Identify the critical cost components and areas for improvement - Reduction in the cycle time of activities

b) To get knowledge of the competition & industry leaders c) To incorporate the best of the best – learn & emulate the best d) To gain superiority over competitors

Page 20: Construction productivity

Types of Benchmarking Internal- Comparison among similar operations within

one’s own organization Competitive- This is comparison to the best of the direct

competitors Functional- Comparison of the methods with the companies

with similar processes in the same function outside one’s country

Page 21: Construction productivity

Types of Benchmarking

Generic

- Comparison of work processes to others who have innovative, exemplar work processes

Cooperative

- Contacting the best in class firms and asking them for knowledge sharing

Collaborative

- A group of firms sharing knowledge about a particular activity

Page 22: Construction productivity

Benchmarking Roadmap

Determine what to Benchmark

Determine Key Factors to be measured

Develop Data Collection Methodology

Collect Data

Identify Foremost Practices Within and Outside Companies

Identify Performance Gap and Reasons for it

Develop Action Plan to Meet And Exceed

Integrate Plan into Business Practices

Improvement

Page 23: Construction productivity

Benchmarking Scope

Products and Services

Business Processes

Performance Measures

Page 24: Construction productivity

Performance Indicators Benchmarking is essentially for continuous

improvement of any organization

Parameter for benchmarking should be based on Key Performance Indicator (KPI)

There can be many KPI’s in the construction industry to measure the job performances

Page 25: Construction productivity

Key Performance IndicatorsA few major ones are listed below Cost Scheduled Duration Quality Scope of work Procurement Construction Planning Engineering Design Operational Health & Safety Sub-contracts

Labour

Productivity

Rework

Material Wastage

Equipment

Activities at planned rate

Page 26: Construction productivity

Labour Productivity Study

The study focused on evolving a framework for benchmarking Labour Productivity for building projects in India

Data were collected from 39 sites through questionnaire and from 12 buildings project through personal interviews

The sites were located in Mumbai, Bangalore, Chennai, Hyderabad and Delhi

Labour productivity for these activities is benchmarked by comparing productivity levels both within and among the regions

Observed productivity at national level is compared with the international levels

Page 27: Construction productivity

Benchmarking in Context of Construction Industry

Major portion of buildings project cost consists of the following activities

Concreting Formwork Masonry Reinforcements

Labour productivity can be benchmarked very well based on these four activities

Page 28: Construction productivity

Concrete productivity in various regions in India

Regions Productivity (cum/manday)

Mumbai 2.97

Bangalore 0.85

Chennai 0.79

Hyderabad 0.99

Delhi 0.49

India Mean

Productivity cum/manday 1.22

Page 29: Construction productivity

Comparison of Concrete Productivity with International Standards

Country M’hr/cum cum/M’dayUS 1.00 8.02England 1.50 5.35China 3.69 2.17Netherlands 1.24 6.47Japan 1.29 6.22Korea 1.26 6.36Saudi Arabia 1.88 4.27Turkey 2.32 3.44India 2.69 2.97

Page 30: Construction productivity

Labour Productivity for Formwork Depends on factors like:

- Type of Formwork system used- Quantity of formwork used- Type of Structure- Shifting methods- Labour skills- Resource availability- Safety and other issues

Page 31: Construction productivity

Formwork productivity in various regions in IndiaRegions Productivity (Sqm/Manday)Mumbai 1.42Bangalore 1.90Chennai 2.19Hyderabad 1.65Delhi 1.10

India MeanProductivity Sqm/Manday 1.7

Page 32: Construction productivity

Formwork productivity in various countriesCountry M’hr/Sqm Sqm/M’day

US 0.82 9.79England 1.23 6.53China 3.02 2.65Netherlands 1.01 7.90Japan 1.05 7.59Korea 1.53 7.77Saudi Arabia 1.54 5.21Turkey 1.90 4.20India 4.71 1.70

Page 33: Construction productivity

Labour Productivity for Masonry

Depends on factors like- Size of Block- Method of shifting- Lead and shift- Labour skill- Type of Structure- Safety and other issues

Page 34: Construction productivity

Brick masonry productivity in various countriesCountry M’hr/cum cum/M’day

US 2.35 3.40

England 3.53 2.27

China 8.70 0.92

Netherlands 2.92 2.74

Japan 3.03 2.64

Korea 2.96 2.7

Saudi Arabia 4.42 1.81

Turkey 5.48 1.46

India 6.35 1.26

Page 35: Construction productivity

Labour Productivity for Reinforcement

• Depends on the factors like• Diameter of bar• Bar bending schedule• Quantity of reinforcement• Method of transport• Availability of bar bending and cutting machine• Skill of labour• Type of Structure• Safety

Page 36: Construction productivity

Reinforcement productivity in various regions in IndiaRegions Productivity (Kg / Man Day)

Mumbai 108

Bangalore 86

Chennai 82

Hyderabad 79

Delhi 56

India 90.5 (Mean)

Page 37: Construction productivity

Conclusions

Construction productivity levels in India are low compared to international levels

The reasons identified for low productivity included less degree of mechanization, conventional practices, lack or training and low focus on productivity by management

The data used in the study is from large companies executing large building projects. There is a need to study the productivity levels in other types of projects

Page 38: Construction productivity

Thank You