Volume 3, Issue 4, October 2013 Analyzing Material .
ISSN: 2277-3754ISO 9001:2008 CertifiedInternational Journal of Engineering and Innovative Technology (IJEIT)Volume 3, Issue 4, October 2013Analyzing Material Management Techniques onConstruction ProjectAshwini R. Patil, Smita V. Pataskarheld up and interest charges incurred on the excess ofinventory of materials. Delays and expenses may be incurredif material required for particular activity. Ensuring a timelyflow of materials is an important concern of materialmanagement. Material planning and inventory control are thetwo most important measures as per as Material managementis concerned. This paper mainly focus on variation in plannedVs actual material cost through S curve analysis and applyinginventory control technique so as to minimize stock outproblems and minimizes the total cost of inventory.Abstract— The efficient procurement of material represents akey role in the successful completion of the work. Poor planningand control of material, lack of material when needed, pooridentification of material, re-handling and inadequate storagecause losses in labor productivity and overall delays that canindirectly increase total project cost. Effective management ofmaterials can reduce these costs. This paper is written to explorethe current practices of Material Management so this study isconducted in two phases, First phase gives the Qualitativeinformation regarding deviation in planned and actual materialsin terms of S curve analysis using MSP tool and reasoning overthe deviation is essential to know the effect of material planningbefore execution of project. Various comments on S curveanalysis have given in terms of problems of administrative causes,consultant’s causes, contractor’s faults, and unavailability ofresources. These major reasons of changes represented in termsof pie chart. To maintain sufficient stock of raw material in periodof short supply, to protect inventory against deterioration andcontrol investment in inventories and to keep it in an optimumlevel an inventory control techniques such as ABC and EOQanalysis is carried out in second phase of study to overcome theproblems of stock out.II. LITERATURE REVIEWA. Objectives of Material ManagementMaterial management system can bring following objectives Efficient material planning Buying or Purchasing Procuring and Receiving Storing and Inventory Control Supply and distribution of material Quality and assurance Improved efficiency Good supplier relationshipTo fulfill all these objectives, it is necessary to establish agood coordination between all the employees of materialmanagement departmentKey Word —Construction Materials, Cost Control, InventoryControl, Material Management.I. INTRODUCTIONConstruction material constitutes a major cost componentin any construction project. The total cost of installed materialmay be 50% or more of the total cost. The goal of materialmanagement is to ensure that the materials are available attheir point of use when needed hence, efficient procurementof material represents a key role in the successful completionof the work. It is important for the contractor to consider thatthere may be significant difference in the date that thematerial was requested or date when the purchase order wasmade, and the time at which the material will be delivered,thus material management is a key of projectmanagement.“Material management is defined as the processto provide right material at right place at right time in rightquantity so as to minimize the cost of project”. Materialmanagement is concerned with the planning, identification,procuring, storage, receiving and distribution of material. Theresponsibility of Material management department for theflow of material from the time the material is ordered,received, and stored until they are used is the basicresponsibility of material management. Materials represent amajor expense in construction, so minimizing procurementcost improves opportunities for reducing the overall projectcost. If materials are to be purchased too early, capital may beB. Benefits of Material ManagementAn effective material management system can bringfollowing benefits Reducing the overall costs of material Better handling of material Reduction in duplicated orders Material is on site when needed and in the quantitiesrequired Improvements in labor productivity Improvements in project schedule Quality control Better field material control Better relations with suppliersC. Process of Material ManagementMaterial management process initiates from need generatedfrom site then this information conveyed to store departmentand material is ordered in the store, indent is generated.Vendor selection is to be carried out for the least value andbest items. Materials are received at store department andinspection is carried out.96
ISSN: 2277-3754ISO 9001:2008 CertifiedInternational Journal of Engineering and Innovative Technology (IJEIT)Volume 3, Issue 4, October 2013gives pre idea about research. It also gives theoretical andMaterial need generated from sitepractical concept. Literature Review: To know the current practices ofConstruction material management, literature review has beenMaterial ordered in storecarried out thoroughly. Interviews: In order to find the observations, Interviews havebeen carried out with project manager, Billing Engineer &Indent is generatedStore In charge. Tender Document: This is a very important source of primaryCheck availability in the storedata because this document gives the tender quantities for thelive project.b)SecondarySources: Secondary data are collected through thoseCheck for the Balance Itemsdata which are already in presence for specific purpose. MRN: MRN means “Material Requisition Note” is that sourceVendor Selection from the approved listwhich gives an idea about requirement of material. Ledger Register: This provides the information regarding theorder of material and Cumulative quantity of material till date.Material Inspection from received stock Daily Material Report: This report gives information regardingdaily material consumption & stock available for further use forthe project.Issue of material to the department Running Amount Bill: This is very important source ofFig.1. Process of Material Managementsecondary data which gives the actual executed quantitiesrequired for the project.III. OUTLINE OF REASEARCH WORKResearch MethodologyIn this research the current material management practicesA. Aimareinvestigated. Material management is not just a concernThe aim of this research is to explore the existing commonduringthe monitoring stage in which construction is takingpractices in construction projects & to apply inventory controlplace.Decisionabout material procurement may also betechnique so as to analyze the effect of material managementrequiredduringinitialplanning and scheduling stage. Secondlyon constructions projects.during execution inventory control technique should beB. Objectivesmonitored periodically so as to maintain flow of material toObjectives which have covered in this project study are asavoid the delays. Basically this research is divided in two partsfollows:such as first one Qualitative analysis & second Quantitative To Compare Planned Vs Actual material consumptionanalysis. Qualitative analysis: This analysis is carried out usingusing MSP software then to find the problems inMSP software for analyzing planned and actual materialplanning, purchasing, procurement & to suggestconsumption through S curve analysis. Reasoning over theremedies regarding the material management.deviations curve is the s shaped graph produced by the the S Curve Analysis is used for comparison of plannedcumulative expenditure of certain parameters (man-hoursand actual cost of construction materialcost) against time and it is the representation of project path. Reasoning over S curve Analysis.This analysis is carried for comparison of planned and actual To apply Inventory Control Techniques such as A-B-Ccost for material.analysis. To apply EOQ analysis to “A” & “B” class inventoriesso as to avoid stock out. Apply inventory control technique so as to minimisethe total cost of inventoryC. Research Methodology and Data CollectionThe research design used in this project is analytical in natureand the procedure using which the Researcher has to use factsor information already available and analyze this to make acritical evaluation of the performance.Data CollectionIn this research few methods of data collection are usedwhich can be divided into two parts sucha) Primary source & b) Secondary Sources.a) Primary Sources: Primary sources are those sources whichFig 2. S curve AnalysisThis analysis is carried out to study the deviation planned andactual material cost.Quantitative Analysis: This study mainly focuses onInventory Control techniques which includes ABC analysis,EOQ analysis and Calculation of Stock levels.97
ISSN: 2277-3754ISO 9001:2008 CertifiedInternational Journal of Engineering and Innovative Technology (IJEIT)Volume 3, Issue 4, October 2013“Inventory control refers to a system, which ensures thesupply of required quantity and quality of inventory at therequired time and at the same time prevent unnecessaryinvestment in inventories.”Objectives of Inventory Control Maintain sufficient stock of raw material in period ofshort supply and anticipate price changes. Control investment in inventories and keep it at anoptimum level. Protect inventory against deterioration,obsolescence and unauthorized use.Inventory Control System is to secure the best balance betweentoo much and too little inventory.”Fig .2 S Curve for Cement1. ABC Analysis.The ABC inventory control technique is based on theprinciple that a small portion of the items may typicallyrepresent the bulk of money value of the total inventory inconstruction process, while a relatively large number of itemsmay from a small part of the money value of stores. Themoney value is ascertained by multiplying the quantity ofmaterial of each item by its unit price. The items“A” Category – 5% to 10% of the items represent 70% to75% of the money value.“B” Category – 15% to 20% of the items represent 15% to20% of the money.Fig 3 S Curve for Steel“C” Category – The remaining number of the itemsrepresent 5% to 10% of the money value.The relative position of these items show that items ofcategory A should be under the maximum control, items ofcategory B may not be given that much attention and item Cmay be under a loose control.2. EOQ analysis: The EOQ refers to the order size that willresult in the lowest total of ordering and carrying costs for anitem of inventory. If a firm place unnecessary orders it willincur unneeded order costs. If a firm places too few order, itmust maintain large stocks of goods and will have excessivecarrying cost.D. Details of Case StudyCompany Profile: The case study which is selected for thisproject is Industrial Building under the guidance of SCONProject. SCON Projects (formerly known as SamarthConstruction) is formed in January 1996. This year they havecelebrated their 15th anniversary. In these 15 years, Companyhave successfully executed en-number of constructionprojects and achieved recognition in the construction field.SCON is a well reputed contracting firm in Pune, whichbelongs to mainly industrial projects. Company has variousindustrial projects going on and some of them are going tolaunch soon. SCON is a winner of "BAI - Well BuiltStructure-2012" award for its project Dohler India. “LMTTOOLS INDIA. LTD.” is one of their project which hasbeen selected as case study for this work.Fig .4 S Curve for BricksAbove graphs shows the comparison of cumulative cost ofplanned actual material. This cost is less at initial stage. This Scurve Analysis recognize that there is too much increase inmaterial cost while actual execution. Though this is smallproject but material management aspect never differs whether itis small or big.Major Causes in Variation of projectIn various executed work remarks have be discuss andaccording pie chart is prepared in which main constraints arediscuss.1) Administrative Causes: This type of reasons covered suchas level changes in excavation, tremendous increase in fillingdue to level changes.2) Contractors Rework: It includes reasons like additionalchanges in structures.3) Delayed in Material: Material is unavailable in proper time.4) Consultant inefficiency: This reason includes reason fromconsultants view. It include like changes in drawing.IV. REPORT ON PRESENT INVESTIGATIONResult from Qualitative Analysis:98
ISSN: 2277-3754ISO 9001:2008 CertifiedInternational Journal of Engineering and Innovative Technology (IJEIT)Volume 3, Issue 4, October 20135) Client reason: This reason includes from owner view. ItV. SUMMARY AND CONCLUSIONincludes like changes in sizes.1. Construction material constitutes a major cost componentFrom the discussion with Project manager the reasons arein any construction project. The total cost of material may befound out over variation in quantities such as tender and50% of total cost; so that it is important for contractor toactual executed quantities.consider that timely availability of material is potential causeSr.Table .1 Causes of variation in ProjectCauses ofNo. OfColour% 9.00reasons2Contractorsrework3Unavailability ofmaterial4Consultantsinefficiency5Owners decisionResult From Quantitative AnalysisEOQ Analysis:In this study EOQ analysis is performed on Cement, Reinforcement Steel, Bricks, Sand & Aggregate. Whileperforming EOQ analysis Ordering Cost & Inventory CarryingCost is assumed for each material with practical executionprocedure of construction. Inventory carrying cost incurred for maintaining the inventory, This includes Cost of Storage,Insurance taxes, Deterioration & obsolescence this calculates in %. Inventory Carrying Cost 20%Economic Order Quantity is calculated by followingformula, where, Co Ordering Cost,S Total ConsumptionCu Cost of ItemI Inventory carrying CostTable No.2 EOQ AnalysisName of AnnualEOQMateria s121 MT170000Cum1213Cum263 CumNo.OfordersFrequencyOfordering4642411Total costofInventoryusingEOQ inlacs311117500341110242753123571120131724 of successful completion of project.2. S curve analysis: It is concluded that major causes ofvariations are as following : Due to unavailability of RCC Design drawings this causesproblems to contractor to work out accurate actual quantities. Due to deviation in Items it will affect on materialprocurement and finally affects the total project budget. If the tender is quoted accurately so that non tender will notarises because basic rate of material fluctuate day to dayleading to increase in cost. Instead of quantities that itemshould be quoted as Rate only item so it is profitable tocontractor & Client. Due to uneven geographical conditions in case soling extradepth of excavation to be considered. From the pie chart conclusion is found out thatadministrative causes are 30% which affects directly oncontractors rework, 5% reasons due to unavailability ofmaterial.3. EOQ AnalysisAfter EOQ analysis for cement it is concluded that economicorder quantity which is 460 Bags & frequency of ordering11days which has overcome the problems of Stock outsuccessfully over the actual Site stock records.For B class material such as sand and aggregate on sitematerial are ordered as per requirement because of spaceavailability they could not maintain stock as per EOQ.After performance of EOQ on sand & Aggregate it can beconcluded that those material does not gives satisfactoryresults because ordering frequency after EOQ was 7 days &17 days but actually on site demand is as per dailyrequirementThe Total cost of inventory after adoption of EOQ analysis isless than without adopting EOQ.Material Manager should maintain reports such as material toorder between two dates, material assignments, waste control,when to purchase construction material, when material mustbe on site, and purchase order between two dates.VI. RECOMMENDATIONNow a day’s various software is adopted for materialmanagement in big scale projects which are too much costly.In case of Big & small projects it is recommended to use ABCand EOQ analysis for inventory control in a year. Before anyexecution of project all detailed drawing is needed to bestudied. R.C.C drawings should be available with thecontractor before execution of the project so that all detailedstudy will be done. Incentive scheme should be adopted forstaff members to attend training courses in constructionmaterial management so they are aware about materialplanning & scheduling at every stage.99
ISSN: 2277-3754ISO 9001:2008 CertifiedInternational Journal of Engineering and Innovative Technology (IJEIT)Volume 3, Issue 4, October 2013This is strongly recommended that the all drawings should beavailable as early as possible.VII. FUTURE SCOPE Material Planning and scheduling can be done atevery stage using construction software such asMSP.Hit office also a very good software for maintainingmaterial inward, issue records which gives theaccurate results in terms of Reconciliation Report.An effective Inventory Control model can bedeveloped using Regression Analysis is furtherscope of study.ACKOWLEDGEMENTI express my profound gratitude to my project guide Prof.Mrs. S.V. Pataskar for her invaluable guidance,encouragement and supervision. It is my sincere feeling ofrespect to express my gratitude to D. Y. PATIL COLLEGEOF ENGINEERING AKURDI, PUNE for giving me anopportunity to carry out this project. I would like to thankMrs. Smita V. Pataskar HOD Civil for extending hercomplete support and encouraging me in every aspect relatedto project that enabled us to put my best efforts.REFERENCES[1] L.C. Bell, G. Stukhart “Attributes of material managementsystems”, ASCE, Vol.112, No. 1, March 1986[2] K.V. Patel, C.M. Vyas “Construction material management onproject sites”, national conference on recent trends inengineering and technology,1314 May 2011[3] E.A. Haddad “Construction material management system forgaza strip building contractors”, Dec 2006.[4] D.U. Kini “The material management is key to successfulproject management”, journal of management inengineering/January/February 1999100
Key Word —Construction Materials, Cost Control, Inventory Control, Material Management. I. INTRODUCTION Construction material constitutes a major cost component in any construction project. The total cost of installed material may be 50% or more of the total cost. The goal of material management is to ensure that the materials are available at
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