Project Report On Construction Overview for Internships

Industrial Training at Puravankara Projects Limited, Bangalore

Chapter 1

Company Profile

Department Of Mechanical Engineering, SJCE, Mysore 1


1.1 VISION

Our vision is “ to build a future where in Puravankara is a household name across the country

and is known worldwide for creating unique landmarks and superior community living by

maintaining highest standards of quality to ensure customer delight ”.



1.2 THE YOU PHILOSOPHY

All our endeavors’ at Puravankara revolve around just one entity - our customers. It is their

needs, demands and ideas that drive us and they continue to remain at the centre of our universe.

We call this "The You Philosophy".

1.3 PROFILE

What started as a dream of our founder Chairman, 36 years ago, has today metamorphosed into a

gratifying reality. A reality that bears testimony to the passion of Puravankara in delivering

homes and commercial spaces which inspire innovation and at the same time present its

occupants with a reason to celebrate the joy of living. Started in Mumbai in 1975, the

Puravankara legacy today epitomizes commitment, professionalism, transparency and growth;

qualities very few in the real estate sector can aver. We blend the best of our local expertise with

those of our partners and international consultants of global repute to provide a wide range of

options to our customers.

Our journey from Maharashtra to Karnataka and to other states in India is a journey of ingenuity,

trust and also of the value creation that we have undertaken for our committed stakeholders, time

and again. Our vision and approach towards organized and well-planned development has led to

our growth in scale and spread. Over these years, the Company has delivered 36 landmark



residential and commercial projects in the cities of Mumbai, Bangalore and Chennai and has

more than 25000 happy customers living in these apartments and row-houses and villas. Today

we have 20 ongoing projects in the major cities like Bangalore, Chennai, Kochi, Coimbatore and

Kolkata. These world-class projects mirror a rich legacy the Company has built for itself.

For an Indian real estate business that is in the fourth decade of its excellence, at Puravankara,

nothing matters more to us than longevity. We arise everyday with a resolve that whatever we

build must stay on for generations - in buildings, profits, brands and goodwill. True, we have

transformed into one of the leading and largest real estate developer in South India today.

1.3.1 LEADERSHIP

Ravi Puravankara

Founder, Chairman & Managing Director

Mr. Ravi Puravankara has been associated with the real estate sector since 1975 and has been

involved in several real estate ventures. He is the promoter of the Puravankara Group. He was

the president of the International Real Estate Federation (FIABCI), Indian Chapter, Paris. He is

the driving force behind the Company's initiatives. He has over 35 years of experience in the

field of real estate and development. Under his management and guidance we have documented

processes in our constructions activities and introduced international quality standards.

Ashish Puravankara

Joint Managing Director

Mr. Ashish Puravankara holds a Bachelors degree in Business Administration from Virginia

State University and a Master's Degree in Business Administration from Willamette University

in Salem, Oregon. He has played a pivotal role in the growth of the Company. He has over 10

years of experience in the field of real estate. He has been responsible for the identification of

opportunities for our Company and has also been instrumental in implementing best construction

practices by the acquisition of new materials and focusing on technology as a means to achieve

quality construction. He has been a director on our Board since 15 July 2



Nani R. Choksey

Deputy Managing Director

Mr. Nani R. Choksey has over 35 years of experience in the real estate development,

construction and finance sectors. He has been associated with our Group since its inception in

1975. He is a founder Director and played a pivotal role in the growth of the Company. He has

been actively involved in all projects of our Company.

Jackbastian K. Nazareth

Chief Executive Officer

Mr. Jackbastian Nazareth holds a Masters degree in Business Administration from the Goa

Institute of Management and a Bachelors degree in Civil Engineering from the Karnataka

University. He has over 21 years of experience in real estate development, corporate affairs,

financial management and civil engineering consultancy. He currently serves as the Chief

Executive Officer of the Company. He is responsible for the day to day operations of the

Company including the detailed project conceptualization, design and finance functions. He has

served as an Executive Director of Sobha Developers Limited. His other major assignments

include as the Director - Sales of TSI Ventures Private Limited, and subsequently as the

Managing Director- Head Sales and Marketing of Tishman Speyer India Private Limited.

Anup Shah

Independent Director

Mr. Anup Shah graduated with a Bachelor's degree in commerce from H.R. College in Mumbai

and a Bachelor's degree in law from Government Law College, Mumbai. He has over 30 years of

experience in the legal field. His areas of expertise include commercial and property due

diligence, corporate and commercial litigation, property related issues, land laws, arbitration and

alternative dispute resolution. He also answers readers' queries through "Legal Eagle", a weekly

article in The Times of India, Bangalore. He has been a director on our Board since 1 June 2005.

R. V. S. Rao




Mr. RVS Rao holds a Bachelors degree in Commerce from the Mysore University and a

Bachelors degree in Law from the Bangalore University. He has completed Master Class for

director conducted in association with World Council for Corporate Governance, London. He

has over 38 years of experience in the fields of banking and finance. He has been a Director of

HDFC Limited. As a USAID consultant, he was the team leader that reviewed operations and

made recommendations for Housing Finance Company, Ghana. He was also the team leader of

the consultancy team which advised the National Development Bank of Sri Lanka in establishing

its mortgage finance business. He is an associate of Indian Institute of Bankers, Mumbai, a life

member of All India Management Association, New Delhi, was an executive committee member

of Bangalore Management Association and the Greater Mysore Chamber of Industry. He has

been a director on our Board since 26 December 2006.

Pradeep Guha


Mr. Pradeep Guha holds a Bachelor's degree in Arts from Mumbai University and a Management

Diploma from Asian Institute of Management, Manila. He has over 35 years of experience in the

fields of media, advertising, marketing and branding. He has recently finished a very successful

stint as the CEO of Zee Entertainment Enterprises Ltd. During his tenure, Zee has reclaimed its

erstwhile position of prominence in the Indian television arena. He has been associated with the

print medium for 29 years and was the President of The Times of India Group, as well as on its

Board of Directors. He is the Vice-President and Area Director of International Advertising

Association, Asia Pacific region. He is the official representative to the Asian Federation of

Advertising Associations and is the current Vice Chairman of the Federation. He is a past

President of the Indian Newspaper Society, ex-Chairman of the National Readership Studies

Council, past President of the Advertising Club Bombay and the first Chairman of the Broadcast

Audience Research Council. He has been a director on our Board since 26 December 2006.



1.4 MAIN OBJECTS

Our main objects enable us to carry on our current business and also the business

proposed to be carried on by us as contained in our Memorandum of Association and are as

follows:

1. To undertake the work of construction of buildings, houses, garages, halls, flats, office

premises, shops, residential accommodation, god owns, warehouses, mills, factories, chawls,

dwelling houses, roads, bridges, culverts, docks, harbor piers, wharves, canals, reservoirs, dams,

embankments, irrigation works, reclamation, improvements, sewage treatment and disposal

works, drainage, sanitation, water gas, electric light, telephonic, telegraphic and power supply

works, hotels, markets, and all other works.

2. To carry on the business of promoting, forming and registering co operative societies, limited

companies, other incorporated bodies or associations of purchasers of allotted of flats, garages or

other testaments on ownership basis and to pay out of the funds of the Company all expenses

with respect to the promotion formation and registration of such societies, limited companies,

incorporated bodies or association and to buy, sell, deal, lease, construct, exchange, remove,

repair, alter, manage, improve, pull down, decorate, maintain and office premises, shops,

residential accommodation, god owns, warehouses etc, and on behalf of the Co-operative

Societies, Limited Companies, incorporated bodies or other associations.

1.5 Year Key Events, Milestones and Achievements:

1986 First project in Mumbai launched by our Company

1990 Our Company commences its operations in Bangalore

1990 First residential project in Bangalore launched

1998 One of our residential project, Purva Park was nominated as a finalist in the

International Prix d’ Excellence awarded by the FIABCI, Paris

1998 Our Company obtains ISO 9001 certification from DNV

2002 Our Company obtains the CRISIL DA2+ rating

2002 Our Company sets up its office in U.A.E.

2004 Our Company sets up its operations in Chennai



2005 Our Company enters into a joint venture with the Keppel Investment Mauritius

Private Limited

2005 Our Company sets up its operations in Kochi

2005 Obtained approval from the Board of Investment in Sri Lanka

1.6 QUALITY

Since inception in 1975, Puravankara has believed if there is one mantra for success, it is

'QUALITY'. Add to this, values like uncompromising business ethos, focused customer centric

approach, robust engineering, in-house Research and Development and transparency in all

spheres of conducting business and what you get is the 'most preferred' real estate brand in both

residential and commercial segments. From planning to materials, construction skills to customer

relations, we strive for perfection in all that we do. Our apartments and properties across the

geographies are the exemplary testimony to Puravankara's thoughtfulness towards creating value

for the customers.

The Puravankara Group has the distinction of being awarded the Finalist, international Prix d'

Excellence - 1998 for its project 'Purva Park' in Bangalore. This award was for the group

residential category by FIABCI, Paris, the International Federation of Real Estate. Two

prestigious apartment projects, Purva Graces & Purva Heights, received a PA 1 rating by

CRISIL. Their reputation as a fair and transparent company has consistently strengthened

amongst capital market participants, including equity analysts and investors. 'The Institute of

Chartered Accountants of India (ICAI)' has awarded them for excellence in financial reporting

for the year ended 31 March 2008. The conscious efforts and professional approach to Human

Resource Development was recognized at the Realty Plus Excellence Awards, 2010-2011 where

Puravankara bagged the coveted award of the 'Best Employer of the Year'. Apart from these,

they have also won the 'Luxury Project of the Year' award for Purva Fountainsquare at the Realty

Plus Excellence Awards South, 2010-2011, 'Best Landscape' award in the Residential Category

by Mysore Horticultural Society 2010 and 'Best Urban Design & Master Planning' award for

Purva Fountainsquare at the Construction Source Felicitation Award Ceremony, 2010.





1.7 Puravankara Projects, BangaloreReady to Occupy

Purva Fountain square

Purva Grande



Purva Belmont

Purva Heights

Purva Carnation



Purva Parkridge

1.7.1 Ongoing Projects1.7.2



Purva Midtown Residences

Purva Skywood

Purva Atria Platina



Purva Highlands

Purva Venezia



Purva Atria



Chapter 2

Organization Structure



2.1 Managerial Organizational Structure


Board of directors

Chairman and managing directors

Sales and Marketing

(Vice President)

Finance

(Vice President)

Human Resources &Administration

(Head)

Legal

(Assistant GeneralManager)

Purchasing

(Vice President)

Technical Director (Vice president)


2.2 Purchasing department

2.2.1 Roles

1. Co-ordination with Architecture department on the selection of products for the new

projects.

2. Preparation of comparison and sending enquires.

3. Negotiation, checking the specifications as per site requirements.

4. Approval of Purchasing orders.


Vice President

Deputy General Manager

Purchase assistant (2 nos)

Purchase officer (4 nos)

Deputy Manager (2 nos)

Senior Manager


2.2.2 Functions of Purchasing Department


Request from Site

Purchase module

Cross Check

Enquires to suppliers

Quotations

Comparative and Negotiate

Place as the standards


2.3 Marketing Department


Vice President

General Manager

Senior Marketing Executive (3 nos)

Deputy Marketing Manager

(2 nos)

Marketing Manager(3

nos)

Senior Marketing

Manager

Deputy General Manager

Marketing Executive (3 nos)

Senior Marketing

Manager

Sales Manager (3 nos)

Deputy Sales Manager

(2 nos)

Senior Sales Executive (3 nos)

Sales Executive (4 nos)

Senior Manager

Manager

Sales Customers Relationship

Management

Sales Executive


2.4.1 Purpose

1. To Sell the flats and villas according to company standards.

1.4.2 Roles

2. To pull the customers.

3. Monitor the Competition.

4. Setting out the Strategy, Planning.

2.4 Human Resources Department


Vice President

Manager (Personnel & Administration)

Labor HRD

Departments HRD

Site HRD

Manager (General)

Manager (Training & Development)

http://www.brandxpress.net/category/strategy/


2.4.1 Objectives

1. To help the organization reach its goals.

2. To ensure effective utilization and maximum development of human resources.

3. To develop and maintain a quality of work life.4. To develop overall personality of each employee in its multidimensional aspect.

2.4.2 Roles

1. Management relationship

2. Control Employee & Admin costs

3. Build relationship with society

4. Recruit Employees

2.4.3 Functions

1. Human resource or manpower planning.

2. Training and development of employees.

3. Developing and maintaining motivation for workers by providing incentives.



2.5 Finance Department

2.5.1 Purpose

1. Provide information for stakeholders – customers, shareholders, suppliers, etc.

2. Provides the opportunity for the company to monitor its own activities

3. Provides transparency to enable the firm to attract investment


Vice President

GENERAL MANAGER

Purchasing Materials (2 nos)Banking (2 nos)Billing (2 nos)

Manager (5nos)

Sales, Accounts & taxes (3 nos)

Pay rolls (2 nos)


2.5.2 Roles

1. Reduce the chance of FRAUD

2. Transparency

3. Monitoring the activities

2.6 Legal Department

2.6.1 Purpose

1. To Maintain Civil and Commercial Law Unit and the Public and Administrative Law Unit.


Vice President

GENERAL MANAGER

Deputy Manager (4 nos)

DEPUTY GENERAL MANAGER


2.6.2 Roles

1. Acts as a broker between Company and the Government.

2. Approvals from local bodies.

3. Providing legal advice and guidance

4. Prosecution of cases in courts and litigation management

5. Documentation preparation and drafting

6. Creation of legal documentation requirements



Chapter 3

Project study on



3.1 Purva Venezia



Purva Venezia is inspired by the magical landscape of venice. Whether it is the sparkling

waterways, the arched bridges or the manicured gardens - the richness, colour, light and texture

will leave you mesmerized.

Every aspect of this high-end home is thoughtfully designed - be it the vitrified flooring, the

ornate lobby or even the water purification plant. Your home will be so self-contained that you

may ever have to step out for days on end. A supermarket, a gym, a swimming pool, a health spa,

a Jacuzzi, a tennis court and many more amenities offer you a lifestyle that is truly unmatched.

If you've always believed in high quality living. Its time to put your beliefs to action. With a

view of 1600 acres of greenery belonging to the University of Agricultural Sciences and its ideal

location, Purva Venezia offers you a lifestyle that is too good to resist.

Location : Yelahanka New Town

Type : 2 & 3 BHK Luxury Apartments

Total No. Of Units : 1332 units

No. Of floors : B1 + B2 + G + 14 floors

Super Built-up

Area: 1322 - 1780 sft

3.2 Amenities

Meditation Room

Aerobic Room

Squash Court

Indoor Badminton

Billiards

Table Tennis, Gym

Steam

Sauna, Jacuzzi

Children's Play Area

Restaurant

Cocktail Lounge



Supermarket

Health Care Centre

3.3 General specifications Doors : Teak wood frame with melamine polish for the main door. Windows : Powder - coated aluminum / PVC with glazed sliding shutters.

Electrical :TV and telephone outlet points in living room and all bedrooms. AC point in

master bedroom.

Back-Up Power : For apartment, Common areas, pumps and lifts Flooring : Vitrified flooring in all areas. Anti-skid ceramic designer tiles for bathroom.

Walls :

All interior walls plastered and painted with oil bound distemper. Exterior

fascia of building is plastered and painted with acrylic based paint.

Bathroom-dado up to ceiling height.

Bathrooms :

Plumbing /Sanitary fittings – Master bedroom toilet with bathtub and granite

counter top. Good quality, Vitreous, pastel colored ceramic ware for water

closets and washbasins. Health faucet in all toilets with button type flush

valve.

Kitchen :Stainless - steel sink with hot and cold water mixer. Kitchen counter top in

highly polished butt-nosed granite.



3.4 Floor plan

3.4.1 3 BHK (Bed, Hall, Kitchen)



3.4.2 2 BHK (Bed, Hall, Kitchen)



3.5 Project schedule:

Started on 1/03/2007

Estimated finishing date12/12/2010.

3.6 Roles and Responsibilities of the Employees

Mr. K. Mathish – VP Tech.( PIC of Project Reporting to Technical Director)

Responsibility & Authority:

1 Project In Charge and head of site management.

2 Responsible for the implementation of Quality system procedures applicable for project.

3 Responsible for maintaining all records as per Quality system procedures applicable for

the project.

4 Check and forward all reports to HO viz. Daily Site Report, Fortnightly/monthly Progress

Report, Monthly material statement, Safety analysis etc.

5 Material – Verification of PR/GRN, Control issue & receipt of materials and answerable

for the wastages in stores and site.

6 Responsible for all the billing activity including approval of bills.

7 Timely renewal of labour license & Workmen Compensation . Policy and follow all

statutory regulations.

8 Collect copies of relevant records viz. WC policy, PF challans, Labor license etc

from contractors and forward to HO.

9 Day to day planning of site activities with respect to Master Schedule.

10 Attend all progress review meetings at site /office and Co-ordination With Consultant /

Architect.

11 Mobilizing required work force for timely completion of the project.

12 Training subordinates.



13 Responsible for returning all the assets given for project execution and prevent misuse of

assets.

14 Material Allocation and Control the issue of materials block wise.

15 Carryout modifications as per the approved estimate.

16 Responsible for Safety & House Keeping of the project.

17 Identification of inputs required for timely completion of the project.

18 Reporting to HO & maintain proper records related to Accidents in the project.

19 Any other responsibility assigned.

Mr. Moinuddin Khan – DGM (QC)

( Reporting to PIC)

1 Approving Authority for the following activities.

a. All PCC & RCC

b. Masonry

c. Plastering

d. Flooring

e. Rework

2 Training subordinates.

3 Authority to sign concrete pours card, Masonry card and Plastering card before

commencement of these activity.

4 Ensure sampling & testing and of materials and concrete as per Quality plan. Report to VP

incase standards are not met.

5 Post construction Quality Measurements for concrete, masonry, plastering & water

proofing. All major issues must be discussed in the site meetings.

6 Checking the finished apartment as per F/Tech/004 and maintain all records related to ISO.

7 Responsible for maintaining all QC records as per Quality system procedures.

8 Monitor modification & maintain records.

9 Ensure that all rework is recorded in the rework register and forwarded to office every

month .

10 Inspection of all incoming materials and dispose non conforming items.



Project Manager/Deputy Project Manager / Sr. Project Engineer ( Reporting to PIC)

Responsibility:

1. Execution of assigned work as per company’s requirement and Engineering standards.

2. Planning of site activities in – co ordination with supporting staff & Raise PR for the

required materials block wise.

3. Attend progress review meetings.

4. Assist PIC in Mobilising work force required for timely completion.

5. Training subordinates.

6. Completion of the assigned work within planned duration.

7. Authorized to certify the measurements in the MB before entering in Quadra and

responsible for timely billing.

8. Quality control of all works and hand over to customers.

9. Answerable for the misuse of company’s assets.

10. Primarily responsible to control wastage of materials and labour.

11. Submit daily production details of respective buildings to PIC

12. Any other responsibility assigned by superiors.

PE/Sr. Site Engineer / Site Engineer/ Jr. Engineer

( Reporting to PM/DPM/ Sr. PE)

Responsibility:

1. Execute the work as per instructions after obtaining permission from building in charge

& PM-QC.

2. Maintain Quality of the assigned work.

3. Record the measurements in MB and take approval of building in charge.

4. Safety of Workmen and House Keeping.

5. Record rework in rework register and obtain approval of PM-QC.

6. Any other work assigned by the superiors.



Quantity Survey Dept – ( Reporting to PIC )

Responsibility:

1. Entry of measurements in ERP software.

2. Prepare work order request with quantities.

3. Bill processing and follow up with HO for work order approval & PRW payments.

4. Clarify doubts to PRW regarding measurements.

5. Preparing MIS reports for approval of PIC.

6. Any other work assigned by PIC.

Sr. Engg. Planning – ( Reporting to PIC )

Responsibility:

1. Overall planning & scheduling of all the activities as per the completion program.

2. Monitoring of day to day activities & update the same to PIC in coordination with the

PMC department.

3. Maintenance of all records drawings, etc. & ISO formats in coordination with PIC &

DGM QC.

4. Generation of all Site Progress Reports – Daily, Weekly & Monthly to PMC Department.

5. Preparing MIS reports for approval of PIC.

6. Any other work assigned by PIC.

Sr. Mechanical Engineer - Reporting to PIC

Responsibility:

1. Preventive maintenance as per the maintenance schedule

2. Breakdown maintenance.

3. Maintaining log books for all equipments at site.

4. Supervising the activities of Operators, Electricians, Mechanics etc.,

5. Answerable for the misuse of company’s Plant and Machinery.

6. Calibration of weighing/measuring equipments as per QSP



Sr. Safety Officer - Reporting to PIC

1. In charge of safety measures required for the safety of personnel working at site

2. Prepare check list as per procedures and submit to DGM ( QC)

3. Overall supervision of house keeping

4. Check and report to PIC incase preventive measures are not adequate

5. Ensure that all the preventive measures are taken as per QSP/20

6. Prepare accident report and analysis. Provide First Aid/ Hospitalization of accident

victims.

Deputy Manager - Store - Reporting to PIC

Responsibility:

1. Overall supervision of Store and connected activities

2. Forwarding Invoice, Delivery Challan and GRN on time to office.

3. Check physical stock of all the costly materials like CP Fittings, Electrical switches, etc

on the last day of the month and prepare Monthly material statement.

4. Physical check of assets quarterly and send report to Head Office in case of difference

With book stock.

5. Proper storage of materials in stores and stacking of idle assets at site.

6. Collect damaged assets from site and report to head office for arranging repairs.

7. Measurements of the vehicles supplying materials to be checked at periodic intervals.

STORE KEEPER/Asst STORE KEEPER ( Reporting to Deputy Manager - Store)

Responsibility:

1. Maintaining Store Records and update issue / receipt in ERP Software.

2. Receive / Issue / Transfer all materials.

3. Signing Delivery Challan and other formats connected with stores.

4. Co – ordinate with the concerned to check the incoming materials and obtain their

signature on the DC.

5. Arrange samples for testing as required by the quality team.



Responsibilities of QC team

1. Checking quality of all the activities day to day and take corrective action incase any bad

workmanship is noticed.

2. Post construction Quality Measurements and maintain records. Prepare analysis of

defects and decide corrective action and recommend preventive action to prevent

repetition of the same mistake.

3. Check the quality of materials received at site and submit reports for discussions in site

meeting.

4. Prepare Pour Card, Plastering Card, Masonry Card before execution and hand over to

production team after approval by the Sr. PE / PE of Quality Assurance.

5. Control drawings (Receiving drawings from office, issuing to concerned, Sending back

superseded drawings & Maintaining drawing register).

6. Supervise the batching of ingredients for Concrete, Mortar etc., and see that there is no

deviation from specifications.

7 Take over flats after completing civil works and hand over to Marketing / After sales.

8 Sampling, testing and maintaining records of test results for materials and concrete.

3.7 Various departments in PURVA VENIZIA

Admin

Materials management

Safety

Stores and Maintenance

Planning

Quantity survey

Stores

Quality

Labor chain

Plumbing

Electrical



External and internal works

3.8 Technical Employees working in PURVA VENIZIA

1. Vice President

2. Deputy General Manager

3. Material Manager

4. Project Managers

5. Deputy Project Managers

6. Project Engineers

7. Senior Site Engineers

8. Site Engineers

9. Senior safety Officer

10.Senior Planning Engineer

11.Junior Engineers



3.9 Materials Management Plan

Materials management is an important element in project planning and control. Materials

represent a major expense in construction, so minimizing procurement or purchase costs

presents important opportunities for reducing costs. Poor materials management can also result

in large and avoidable costs during construction. First, if materials are purchased early, capital

may be tied up and interest charges incurred on the excess inventory of materials. Even worse,

materials may deteriorate during storage or be stolen unless special care is taken. For example,

electrical equipment often must be stored in waterproof locations. Second, delays and extra

expenses may be incurred if materials required for particular activities are not available.

Accordingly, insuring a timely flow of material is an important concern of project managers.

Materials management is not just a concern during the monitoring stage in which construction is

taking place. Decisions about material procurement may also be required during the initial

planning and scheduling stages. For example, activities can be inserted in the project schedule to

represent purchasing of major items such as elevators for buildings. The availability of materials

may greatly influence the schedule in projects with a fast track or very tight time schedule:

sufficient time for obtaining the necessary materials must be allowed. In some case, more

expensive suppliers or shippers may be employed to save time.

Materials management is also a problem at the organization level if central purchasing and

inventory control is used for standard items. In this case, the various projects undertaken by the

organization would present requests to the central purchasing group. In turn, this group would

maintain inventories of standard items to reduce the delay in providing material or to obtain

lower costs due to bulk purchasing. This organizational materials management problem is

analogous to inventory control in any organization facing continuing demand for particular

items.

Materials ordering problems lend themselves particularly well to computer based systems to

insure the consistency and completeness of the purchasing process. In the manufacturing realm,

the use of automated materials requirements planning systems is common. In these systems, the

master production schedule, inventory records and product component lists are merged to



determine what items must be ordered, when they should be ordered, and how much of each item

should be ordered in each time period. The heart of these calculations is simple arithmetic: the

projected demand for each material item in each period is subtracted from the available

inventory. When the inventory becomes too low, a new order is recommended. For items that are

non-standard or not kept in inventory, the calculation is even simpler since no inventory must be

considered. With a materials requirement system, much of the detailed record keeping is

automated and project managers are alerted to purchasing requirements

Materials management is a process: It is how a building is designed and how materials are

estimated. It is how materials are acquired and even how the packaging is specified. It is how the

delivery schedule is designed. It is how contractors plan materials use and how they manage

previously used materials and cuts. It is how waste is managed for use elsewhere or recycling

rather than being discarded in a landfill. It is a culture: It is how the customer expects the

contractor, and contractor its subcontractors, and the subcontractors its workers -- to care for and

properly manage the materials provided.

5 R in Material Management

Right Quality

Right Quantity

Right Time

Right Source

Right Rate



3.9.1 MATERIALS MANAGEMENT IN PVNZ


Block Request

(from site)

Cross Check

PIC

Head Office

Purchase

Approval

P.O

PVNZ

Quotation

Z

X

Y

27/-

25/-

26/-

Comparison Statement of Quotation

Quality, Quantity, Time


Functions of Purchasing Department


Request from Site

Purchase module

Cross Check

Enquires to suppliers

Quotations

Comparative and Negotiate

Place as the standards


Objective of material management

To purchase the materials at right price

To achieve high turnover of materials

To achieve low procurement and storage costs

To have continuity of supply

To have consistency in quality

To have good supplier relations

Basic principles of material management

1. Effective management & supervision,

It depends on managerial functions of

Planning

Organizing

Staffing

Directing

Controlling

Reporting

Budgeting

2. Sound purchasing methods

3. Skillful & hard poised negotiations

4. Effective purchase system

5. Should be simple

6 Must not increase other costs

7. Simple inventory control programme

Material Procurement and Delivery



The main sources of information for feedback and control of material procurement are

requisitions, bids and quotations, purchase orders and subcontracts, shipping and receiving

documents, and invoices. For projects involving the large scale use of critical resources, the

owner may initiate the procurement procedure even before the selection of a constructor in order

to avoid shortages and delays. Under ordinary circumstances, the constructor will handle the

procurement to shop for materials with the best price/performance characteristics specified by

the designer. Some overlapping and re handling in the procurement process is unavoidable, but it

should be minimized to insure timely delivery of the materials in good condition.

The materials for delivery to and from a construction site may be broadly classified as : (1) bulk

materials, (2) standard off-the-shelf materials, and (3) fabricated members or units. The process

of delivery, including transportation, field storage and installation will be different for these

classes of materials. The equipment needed to handle and haul these classes of materials will also

be different.

Bulk materials refer to materials in their natural or semi-processed state, such as earthwork to be

excavated, wet concrete mix, etc. which are usually encountered in large quantities in

construction. Some bulk materials such as earthwork or gravels may be measured in bank (solid

in situ) volume. Obviously, the quantities of materials for delivery may be substantially different

when expressed in different measures of volume, depending on the characteristics of such

materials.

Standard piping and valves are typical examples of standard off-the-shelf materials which are

used extensively in the chemical processing industry. Since standard off-the-shelf materials can

easily be stockpiled, the delivery process is relatively simple.

Fabricated members such as steel beams and columns for buildings are pre-processed in a shop

to simplify the field erection procedures. Welded or bolted connections are attached partially to

the members which are cut to precise dimensions for adequate fit. Similarly, steel tanks and

pressure vessels are often partly or fully fabricated before shipping to the field. In general, if the

work can be done in the shop where working conditions can better be controlled, it is advisable



to do so, provided that the fabricated members or units can be shipped to the construction site in

a satisfactory manner at a reasonable cost.

As a further step to simplify field assembly, an entire wall panel including plumbing and wiring

or even an entire room may be prefabricated and shipped to the site. While the field labor is

greatly reduced in such cases, "materials" for delivery are in fact manufactured products with

value added by another type of labor. With modern means of transporting construction materials

and fabricated units, the percentages of costs on direct labor and materials for a project may

change if more prefabricated units are introduced in the construction process.

In the construction industry, materials used by a specific craft are generally handled by

craftsmen, not by general labor. Thus pipefitters handle pipe materials, etc. This multiple

handling diverts scarce skilled craftsmen and contractor supervision into activities which do not

directly contribute to construction. Since contractors are not normally in the freight business,

they do not perform the tasks of freight delivery efficiently. All these factors tend to exacerbate

the problems of freight delivery for very large projects.

Objectives of procurement system

Acquire needed supplies as inexpensively as possible

Obtain high quality supplies

Assure prompt & dependable delivery

Distribute the procurement workload to avoid period of idleness & overwork

Optimize inventory management through scientific procurement procedures

Procurement Management

1. Specification

2. Selection

3. Contracting

4. Control

5. Measurement



Managing project procurements and acquisitions requires the project manager to efficiently

collaborate with the purchasing department on the process of planning and managing

procurements. Procurement management is a section of the implementation plan to determine

how “the ordered products necessary for producing deliverables can be delivered on time and

within the allocated budget”. Note that the “Procurement Management” section of the

implementation plan will be necessary only for projects that have to deal with substantial buy-in

of expertise or capital items. For any other projects where there is no high level of procurement

expenditure it is enough to include a procurement item list and a vendors list in the project

implementation plan.

Planning of project procurements is carried out within the procurement process and results in

developing a plan. A procurement plan is a convenient tool for organizing and managing

activities and tasks related to the procurement management process. A template of the plan is to

be designed by the purchasing department in cooperation with the project manager. A project

procurement plan should be reviewed and approved by the project manager before any supplier

relationships get started.

Procurement Methods

Open Tenders

Open tenders are public bidding which results in lower prices. Open tenders are

usually published in newspapers at least 4 weeks in advance, Quotations must be sent

In specific forms that are sold, before the time and date mentioned in tender form.

In technical terms, “Two packets or two bins” system is followed. Offers are given

in two separate packets i.e. 1) Technical bid and

2) Financial bid.

First technical bid is opened & short listed, then financial bid of selected companies



Are opened and lowest is selected. Delayed tenders & late tenders are not accepted. But if, in

case of delayed tenders, if the rate quoted is very less, then it can be accepted. Quotations are

opened in presence of indenting department, accounts & authorized persons of party .Validity of

tenders – generally 90 days

Rate contract: Firms are asked to supply stores at specified Rates during the period

covered by the Contract

Spot Purchase: It is done by a committee, which includes an officer from stores,

accounts & purchasing departments

Risk Purchase: If supplier fails, the item is purchased from other agencies & the

difference in cost is recovered from the first supplier

Restricted or limited tender: Purchase is made from limited suppliers (about 10). Lead-

time is reduced and also better quality can be expected.

Negotiated Procurement: Buyer approaches selected potential Suppliers and bargain

directly .Used in long time supply contracts

Direct Procurement: Purchased from single supplier, at his quoted price ,Prices may be

high ,Reserved for proprietary materials, or low priced, small quantity & emergency

purchases

Points to remember while purchasing

Proper specification

Invite quotations from reputed firms

Comparison of offers based on basic price, freight & insurance, taxes and levies

Quantity & payment discounts

Payment terms

Delivery period, guarantee

Vendor reputation

(Reliability, technical capabilities, Convenience, Availability, after-sales service, sales

assistance)



Short listing for better negotiation terms

Seek order acknowledgement

Inventory control

Inventory control means stocking adequate number and kinds of materials, so that the materials

are available whenever required and wherever required. Scientific inventory control results in

optimal balance

Objectives of inventory control

To facilitate smooth operation of the manufacturing process.

To minimize investment in inventory

To reduce material handling costs

Reasonable utilization of people

Inventory costs

Ordering costs: It is the cost of placing an order with a vendor of materials, ordering cost include

o Cost of preparing a purchase order

o Cost of processing payments

o Cost of receiving and inspecting the material

Carrying costs: It is the cost directly connected with materials, carrying costs include

cost due to

o Obsolescence



o Deterioration

o Pilferage

Financial costs like taxes, Insurance, Storage, interest also come under carrying cost

Capital costs: It is the cost incurred due to loss of

o Interest on money invested in inventory

o Interest on money in land and building

Storage Space costs also comes under capital costs which include

o Building rent

o Depreciation

o Cost of maintenance

o Inventory service costs

Out of stock costs results due to lost sales, transportation

Benefits of Inventory management

Inventory control ensures an adequate supply of materials, stores, etc. minimizes

stock outs and shortages, and avoids costly interruptions in project operations.

It keeps down investments in inventories, inventory carrying costs and obsolescence

losses to the minimum

It facilitates purchasing economies through the measurement of requirements on

the basis of recorded experience

It eliminates duplication in ordering or in replenishing stocks by centralizing the

source from which purchase requisitions emanate

It permits a better utilization of available stocks by facilitating inter departmental

transfers within a company

It provides a check against loss of materials through carelessness or pilferage



It facilitates cost accounting activities by providing a means for allocating material

costs to products, departments or other operating accounts

It enables management to make cost and consumption comparison between

operations and periods

It serves as a means for the location and disposition of inactive and obsolete items

of stores

Perpetual inventory values provide a consistent and reliable basis for preparing

financial statements.

Physical distribution management

In physical distribution decision on which mode of transport is best to distribute Products to the

Customers is a crucial one. Different modes of transportation are available

Road transport (cars, trucks),

Railway transport,

Water transport (ships),

Air transport, and

Pipelines (oil, natural gas).

Air transport is very expensive and limited in Space availability. Therefore,

It is usually preferred for small-quantity, high-value products, which require fast delivery

(e.g., highly fragile electronic parts).

On the contrary, Water, Road or Railway transportation is slower BUT cheaper.

Therefore, they are used for carrying Large Quantities of raw materials (e.g., coal and

iron).



There may be some limitations on these modes of transport, as well. For

example, only Gas and Liquids can be conveniently transported by Pipelines.

Similarly, very large products (such as storage tanks) would not fit in most Aircrafts.

However, the mode of transport is usually Chosen with reference to the Relative

Importance of the following factors:

Delivery speed

Delivery dependability (reliability)

Quality deterioration

Transportation cost, and

Route flexibility.



Ethics in purchasing:

Many decisions remain largely a matter of personal judgment.

Purchase manager is the custodian of company funds, responsible for their

conservation and wise spending.

Because of his contacts, he is the custodian of company’s reputation for courtesy

and fair dealing.

A high ethical standard of conduct is essential.

They are subjected to more temptations

Since they spend huge sum of money, they yield tremendous power and are the

objects of considerable attention from suppliers.

They are in an excellent position to be dishonest if they want to.

But they have to be ethical



Chapter 4

Conclusion



Conclusion

An effective material management is not only good techniques for planning, monitoring

and control of processes, materials at the site, office but also is good function to avoid the most

frequently occurring problems. The purchasing in the project must connect between planning for

requirement and ordering of demand for material and equipment on the site. The purchasing

ensures that materials and equipment are supplied with competitive price, on schedule work and

good quality. In purchasing, the relationship with suppliers and performance of suppliers are

keys to have the effective material management.



Bibliography

www.Puravankara.com

Material Management Report.

Annual report

“Materials Management” Text and Cases by A.K.Chitale and R.C.Gupta

“Materials Management” by A.K. Datta


Documents

Project Report On Construction Overview for Internships