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MINISTRY OF PUBLIC WORKSWORKS SERVICES G ROUP

5TH Engineering ConferenceDefending Guyana’s Development with Engineering

Solutions

Value for Money in the Construction Sector

Sunil Ganesh©

Sam Labi

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Delivering a Project within Time and Cost

Social and Economic Benefits

Sound and Creative Designs

Meet Stakeholders Requirements

Fitness for Purpose

Concept of Value for Money (VFM)

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Costs ($) Inputs Outputs Outcomes

Economy Efficiency Effectiveness

Value for Money

Objectives

3Es: Contributing Element of VFM

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3Es: Contributing Element of VFM

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1. Cost Assessment of Alternative Designs

2. Quality Processes

3. Project Audits and Reviews

4. Exploring Financial Synergy

5. Routine Maintenance and Management System

6. Weight Control Programme

How Can Value for Money be Achieved ?

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1.0 Cost Assessment: Life Cycle Cost Analysis (LCCA)

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100%

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Ability to Influence Construction Costs over Time

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Oper.Concept &Feasibility

Design and Engineering

Procurement and Construction Startup

Ability to Influence Costs

Construction Cost

1.0 Cost Assessment: Level of Influence on Cost

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2.0 Quality Processes

Quality Control

Quality Assurance

Quality Management

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2.0 Quality Processes: Quality Control vs. Quality Assurance: What’s the Difference?

Analogy: You Driving on aHighway

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Analogy: You Driving on a Highway

Driving Quality AssuranceBefore Driving: adjust seats, mirrors, temp, etc.During Driving:

Occasional glances at: - speed gage to ensure speed is not excessive

- side mirror before changing lane - road sides to read road signs, etc.No distractive activities (reading, eating, etc.)

These are preventive measures

(Technical Specifications)

2.0 Quality Processes: Quality Control vs. Quality Assurance: What’s the Difference?

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Analogy: You Driving on a

Highway

Before Driving: adjust seats, mirrors, temp, etc.During Driving:

Occasional glances at: - speed gage to ensure speed is not excessive

- side mirror before changing lane - road sides to read road signs, etc.No distractive activities (reading, eating, etc.)

During and After Driving: Generate/report data to prove that necessary precautions were taken and that your driving did not violate any rules

Swerving to avoid Cow crossing the highwaySteering to right if car is straying into left lane

Braking to avoid hitting slowed car in front

Driving Quality Assurance

Driving Quality Control

These are corrective measures

2.0 Quality Processes: Quality Control vs. Quality Assurance: What’s the Difference?

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Quality Assurance- “Do it right the first time". Preventive Quality checks.

Quality Control: Fix it when ever it goes or is going wrong

But note! In recent years, QA is defined to include QC

Newer Definition of QA:

The acts of (i) establishing that product is being delivered according to all specifications, (2) providing evidence needed to establish confidence that all quality-related activities are being performed effectively

2.0 Quality Processes: Quality Control vs. Quality Assurance: What’s the Difference?

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2.0 Quality Processes: What is Quality Management?

Involves all parts of the organization (main C, sub-C, suppliers, etc.)

Through a systematic, comprehensive and well-documented QA process

Rationale: Improved QA serves to enhance all other performance metrics of the project (time, cost, etc.) in long run

Objective: A “zero-defects” product

Technique: Preventive as well as corrective -- Ensure quality NOT ONLY by rejecting failures but ALSO by investigating possible risks and threats to quality at root sources

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Aimed at continuous improvement

Ensures that the environment surrounding the Product is viewed in the broadest sense including:

- Quality of Life- Well-being and satisfaction of all people Involved- Long-lasting relationships with customers and suppliers etc.

2.0 Quality Processes: What is Quality Management?

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How is Quality Related to Construction Method?Method 1 - Product may be produced

elsewhere and then brought to site, …

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Prefab factory

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… or Method 2 - product may be produced at the Site

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2.0 Quality Processes: The Relationships:Quality Control, Quality Assurance, Project Monitoring

Project Monito

ring Quality Assurance

Quality Control

Monitoring of project

Quality

Monitoring of other project performance metrics

(Time, Scope, Cost.)

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2.0 Quality Processes: Linkages with regards to VFM

Time Quality

$Acceleration $(Overtime, shift work, Rework, higher-end equipment, better crews etc.)

Less $ Low progress Resource reduction Selection of poor quality workers Default of contractor/subs

Quality problems may result from overtime, shift work, new hires

Quality level impacts speed of work, Level of rework

Need for rework imposes high expensesHigh quality needs can lead to costly miscalculations on labor time

Trying to save $Can lead to substitution, lower quality workmanship

Slow progress $ Delayed occupation, Higher interest on const. loan Loss of Opportunity cost

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Going back to examine the product from the project. - Has product (or part thereof) been produced? - When was it done? punctual?- Was it done right? - With the needed resources? Within the given time?

Reviews enable us to learn from mistakes as well as successes.

Project reviews may be carried out by external parties (e.g. consultants)

3.1 Project Reviews

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3.1 Project Reviews

Why construction projects in particular need reviews:

Design and Planning Phase Generating 75 % of the Problems Encountered in the Construction Site Need for Understanding and Coordinating the Contract Documents and Technical Specifications

Current era: construction very fast paced Errors More Likely Frequent critical reviews are needed more and more to keep up with the pace.

Rising requirements for high quality and corporate effectiveness

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Definition: A thorough examination of the management of a project (methodology and procedures, records, properties, budgets and expenditures, and degree of completion. (Meredith and Mantel, 2006)

Difference: Quality Review: What problems are there? When did they occur? How severe?Quality Audit: Detailed form of Project Review

Mostly, Why did the problems occur? More formal and more documented.

Audits are the most formal and comprehensive form of project review.Goal here is to understand why project is in its current stateProject audits may be for the entire project or only for parts thereofProject audits present the best opportunity for Cost Savings.

3.2 Project Audits – What are they ?

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3.2 Project Audits

Investigate the project (or a part of it). In doing so, they must be honest and objective. Only then will they be useful.

Plan audits carefully: Establish a baseline for comparison, but be open to in-depth investigation if necessary. If the project is long or complex, plan the Audit as a continuous learning processes.

Make audits worthwhile: Introduce the auditing procedure as an integral part of the product development process. Teach people to appreciate it and learn from it. It works for them, not against them.

4.0 Exploring Financial Synergy

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Specialization of contractors Award certain part of projects to contractors who have the skills and capacity to execute these jobs more timely.

Collaborate more with other Agency ( NDIA /NDC/GWI etc)

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5.0 Routine Maintenance

Crucial element after the installation of any infrastructure to ensure the value for money benefits.

It is a temporary correction that prolongs the design life of the infrastructure .

Lower vehicle operating cost and Reduce Travel Time Saving

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5.0 Routine Maintenance(con’t)

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Effects of Maintenance and Rehabilitation Timing

Rehabilitation Time Vs Cost

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5.0 Routine Maintenance(con’t)

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Effects of Maintenance on a Pavement Life Cycle

6.0 Weight Control Program

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The amount of damage a road sustains is directly related to the

weight of the load

how often weight is applied.

weight and number of tires on each axle.

6.0 Weight Control Program : DAMAGE FACTOR

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Damage Factor by a Truck is Calculated as follow

Weight of axle =Standard axle => Damage Factor 1.

Weight of axle 2 times Standard axle => Damage Factor 16

FOURTH POWER RULE

6.0 Weight Control Program: WAY FORWARD

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Design Consultancy for the Grove-Timehri Roadway:

Analyse the nature and scope of vehicle overloading

Review and update our weight control legislation

Design a control facility

Conclusions/Recommendatio

ns

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Detail Cost Assessment of Alternative, Adequate Quality Processes, Project Audits and Reviews are tools in

obtaining the maximum benefit over time with the resources available, achieving the right local balance between economy, efficiency and effectiveness, and creating a product that meet Value for Money.

An early and systematic maintenance and rehabilitation plan in conjunction with a Weight Control Programme are most cost effective and can results in the greatest extension of useful pavement life and ensure Value for Money during the whole life of the Infrastructure.

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MINISTRY OF PUBLIC WORKSWORKS SERVICES G ROUP

5TH Engineering ConferenceDefending Guyana’s Development with Engineering

Solutions

Value for Money in the Construction Sector

Sunil Ganesh

© Sam Labi

Questions?