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HUMAN RESOURCE MANAGEMENT ON CONSTRUCTION SITE BY USING LEAN AND SIX SIGMA ME

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HUMAN RESOURCE MANAGEMENT ON CONSTRUCTION SITE BY USING LEAN AND SIX SIGMA ME Powered By Docstoc
					International Journal of Management (IJM), ISSN 0976 – 6502(Print), ISSN 0976 - 6510(Online),
  INTERNATIONAL JOURNAL OF MANAGEMENT (IJM)
Volume 4, Issue 4, July-August (2013)


ISSN 0976-6502 (Print)
ISSN 0976-6510 (Online)                                                            IJM
Volume 4, Issue 4, July-August (2013), pp. 131-140
© IAEME: www.iaeme.com/ijm.asp                                               ©IAEME
Journal Impact Factor (2013): 6.9071 (Calculated by GISI)
www.jifactor.com



    HUMAN RESOURCE MANAGEMENT ON CONSTRUCTION SITE BY
           USING LEAN AND SIX SIGMA METHODOLOGY

                            Sunil V. Desale * and Dr. S. V. Deodhar **
    *Department of Civil Engineering, SSVPS B S Deore College of Engineering, Dhule , India.
                 **Department of Civil Engineering, SVITS Indore (M.P),India


ABSTRACT

        The competiveness and profit margin of organization over the other organizational depend on
proper utilization of resources such as financial, physical facilities, technology, human… these
factors are intimate relationship and influence to each other together, in which Human Resources is
the most potential determinant. Last planner system is especially appropeate for design production
control because of the value generating nature of design which renders ineffective traditional
techniques such as detailed front end planning and control, which save indirect cost of the project
due to additional labour/ persons accompany with security guard on site. The aim of this case study
is to analysis indirect cost formation due to additional person accompany with security guard on site
and gives suitable suggestion to construction professional for minimization cost burden on project
cash flow.

Keywords: Last planner, traditional planning, Weekly work plan, work environment.

INTRODUCTION

        Construction industry is deemed to operate by diversify workforce, hence managing human
resource issue deems to be a challenging task. However, as the role of Human factors in the process
of business and productive activities, Human Resource Management is the key factor which has the
immediate impact to the organizational structure, especially in the Construction Industry, so Human
Resources are the most valuable source of Capital. Realizing the importance of the enormous direct
impact of Human Resources Management to the organization, the theme of “Human Resource
Management in Construction project” has been chosen for this case study.
        This study is to examine the implementation of Planning and Development of Human
Resource Management on Construction site. Particularly for watchman or security guard appointed
at construction site .The core of the study is to optimize the specific area of Organizational planning
about human resource management. The problem is that we always neglect indirect costing through
idle or unnecessary manpower on construction site in this study the efficient and effective use of
watchman or security guard employed at site has been made. Case study results also indicate the

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Volume 4, Issue 4, July-August (2013)

unnecessary burden on cash reserve of organization improve through the efficient use of Human
Resource in Construction Project, Human Resource Management will contribute a significant
positive impact towards the cost saving in Construction.

Methodology

        In this study project 30 sites at various places were studied .All the 30 sites construction of
bungalow at different places in Dhule District The details of site location, plot area ,construction area
and construction duration of all are given in table 1. At all these sites watchman was appointed. The
no of family members male, female, children of each family is given in table no 2.
In this case study a study was carried of 30 site surveys for primary collection data but we are able to
collect data from various 25 numbers of site in that gathered information relating family members,
electric consumption, water requirement etc. for calculating indirect cost burden on cash flow of site.
For analysis we are represent gathered data in following table format and done a suitable calculation
for achieving a result. A case study of construction of 30 bungalows was made. The details of there
are given in Table 1.

  Sr.        Survey No. OR        Plot    Area of Plot in   Area of Construction     Construction
  No            Gat No.           No.       M2 (Sq.ft)          in M2 (Sq.ft)      Duration in months
   1                               33     235 (2528.60)        185.87 (2000)               21
   2                                2     584 (6283.84)        381.00 (4100)               27
   3                                3     536 (5767.36)        343.87 (3700)               25
   4                                4     576 (6197.76)        354.92 (3819)               26
           GAT. NO 8/1 & 9
   5                                5     580 (6240.80)        384.39 (4136)               28
              Morane
   6                                6     491 (5283.16)        322.02 (3465)               24
   7                                7     502 (5401.52)        334.57 (3600)               25
   8                                8     459 (4938.84)        294.42 (3168)          Not Available
   9                               32     202 (2173.52)        137.36 (1478)               16
   10                               9     163 (1753.88)        115.89 (1247)               14
   11                              10     157 (1689.32)        124.72 (1342)               15
   12                             23B     150 (1614.00)        126.02 (1356)               15
   13                             23A     150 (1614.00)        120.63 (1298)               14
   14                             47B     150 (1614.00)        110.04 (1184)          Not Available
   15                             47A     146 (1570.96)        101.21 (1089)               13
           Survey NO 475/1 +
   16                             46B     146 (1570.96)        102.23 (1100)               13
                 475/2
   17                             46A     146 (1570.96)        104.37 (1123)               14
   18                             27B     149 (1603.24)        115.98 (1248)               14
   19                             48A     150 (1614.00)        114.87 (1236)          Not Available
   20                             24A     148 (1592.48)        108.55 (1168)               13
   21                             33B     146 (1570.96)        110.31 (1187)               13
   22                             33A     146 (1570.96)        97.12 (1045)                13
   23   i)GAT NO.37/5 & 37/6       8A     144 (1549.44)        114.40 (1231)          Not Available
   24                              8B     144 (1549.44)        108.46 (1167)               14
   25   ii)GAT NO.37/1A &          39     150 (1614.00)        114.59 (1233)               15
   26   37/1B-2.2, MORANE          15     155 (1667.80)        126.58 (1362)               15
   27                              16     166 (1786.16)        129.46 (1393)          Not Available
   28                              24     157 (1689.32)        118.77 (1278)               14
   29                              26     199 (2141.24)        137.82 (1483)               15
   30                             35B     146 (1570.96)        106.27 (1143)               13
              Average Value                                   171.56 (1845.95)             18
                                   Table:1 Data: Site Information


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    Sr. No     Survey No. OR GAT No.         Plot No.   Male   Female Boy’s Girl’s        Total
                                                                                         Family
                                                                                        Members
       1                                        33       1        1       2       1        5
       2                                         2       2        1       1       3        7
       3                                         3       1        1       3       -        5
       4                                         4       1        1       2       2        6
       5      GAT. NO 8/1 & 9 Morane             5       1        1       1       2        5
       6                                         6       1        1       3       1        6
       7                                         7       -        2       1       2        5
       8                                         8       1        1       1       1        4
       9                                        32       1        1       2       3        7
      10                                         9       1        1       2       2        6
      11                                        10       1        1       2       3        7
      12                                       23B       1        1       2       2        6
      13                                       23A       1        1       1       1        4
      14                                       47B       1        1       4       2        8
      15                                       47A       1        -       -       -        1
      16       Survey NO 475/1 + 475/2         46B       -        1       -       2        3
      17                                       46A       1        1       -       -        2
      18                                       27B       1        1       2       -        4
      19                                       48A       1        1       1       4        7
      20                                       24A       -        1       1       2        4
      21                                       33B       1        1       2       2        6
      22                                       33A       1        1       2       1        5
      23     i)GAT NO.37/5 & 37/6               8A       1        1       1       1        4
      24                                        8B       -        1       -       -        1
      25     ii)GAT NO.37/1A & 37/1B-           39       1        -       -       -        1
      26     2.2, MORANE                        15       1        1       3       1        6
      27                                        16       1        1       2       3        7
      28                                        24       1        1       1       1         4
      29                                        26       1        2       1       3         7
      30                                       35B       1        1       1       1         4
                            Table 2: Watchmen’s Family Information

Requirement of Resources

       Following figures are taken for calculation after surveying all 30 sites and average value is
considered for other calculation
The requirement of electricity is calculated on the basis of 1 Bulb of 40Watts, 1Fan, 8 hours per day,
1 TV unit, 3/ 4 hours per day.
Fan =70 W for 8 hours = 560 W
1 Bulb =40 W for 8 hours = 320 W
TV for 3 hours= 210W=210W
Misc.=
Total 1200W that is 1.2 units per day


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i) Electricity Requirement = 7 Unit/Person/Month

        The requirement of Water /Person/Day is calculated as per the requirement of Watchman &
his consumption- For Making fresh in the morning 2 Ltrs., for WC 5 l Ltrs., for tacking Bath 15
Ltrs.., After & Before Lunch 2 Ltrs.., Evening after Dinner 2 Ltrs., For Cleaning Vassels/Pots 20
Ltrs.(Morning –Evening). For Washing Cloths 50 Ltrs. Total 96 Ltrs. Say 100 Ltrs. For calculation
purpose.

ii) Water Requirement         = 100 liters/Person/Day

        The Electricity Consumption and Water Requirement of family of watchman for all the 30
cases is shown in table no 3, this table also shows consumption of power in units per month and
water requirement in litre/day

     Sr.     Survey No. OR       Plot      No.              Electricity       Water         Remark
     No        GAT No.           No.      Person          Consumption in   Requirement in
                                                            unit/month        Lit/day
     1      GAT. NO 8/1 & 9       33            5                35             500
     2         Morane              2            7                49             700
     3                             3            5                35             500
     4                             4            6                42             600
     5                             5            5                35             500
     6                             6            6                42             600
     7                             7            5                35             500
     8                             8            4                28             400
     9                            32            7                49             700
     10    Survey NO 475/1 +       9            6                42             600
     11          475/2            10            7                49             700
     12                          23B            6                42             600
     13                          23A            4                28             400
     14                          47B            8                56             800
     15                          47A            1                07             100
     16                          46B            3                21             300
     17                          46A            2                14             200
     18                          27B            4                28             400
     19                          48A            7                49             700
     20                          24A            4                28             400
     21                          33B            6                42             600
     22                          33A            5                35             500
     23     i)GAT NO.37/5 &       8A            4                28             400
     24           37/6            8B            1                07             100
     25                           39            1                07             100
     26     ii)GAT NO.37/1A       15            6                42             600
     27        & 37/1B-2.2,       16            7                49             700
                MORANE
     28                           24            4              28               400
     29                           26            7              49               700
     30                          35B            4              28               400
             Average Value                4.8                33.6 unit         480 lit.




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Volume 4, Issue 4, July-August (2013)

Analysis and Discussion:

Assume:
                 Cost of one electrical unit: Rs. 6/-Unit
                 Cost of water: In Rs.250/- get 5000 lit. water means cost of one lit. is Rs. 0.05/-
                 One month salary: Rs.3500/- + free housing

Consideration of statics by using avability of data through survey:

a)        Average area of construction          : 1846 Sq. Ft (Say 1850 Sq. Ft.)
b)        Average electrical consumption        : 33.6 units / month
c)        Average water consumption             : 480 lit./day
d)        Average payment                       : Rs. 3500/- per month
e)        Average construction duration         : 18 Months.

As per above available data and assumption for the average expenditure per site is;

i) Average electrical expenditure               : 33.6 X 6   = Rs. 201.6/- per month
ii) Average Water Consumption                   : 480 X 0.05 = Rs. 24/-
                                                : 24X 30     = Rs. 720/- per month
iii) Average Payment                                         = Rs.3500/- per month

So; average expenditure as per each site           = Rs. 4421.6/- per month (Indirect Cost)

Average expenditure per sq.ft= 4421.6/ 1846       = Rs. 2.39 per sq. Ft./ month

Overall cost add up to completion of project       = Rs. 43.02 per sq. Ft./ Project----------- (a)

       By analysis of above data it come to know that each contractor paid indirect cost through
deploying watchmen on site up to completion of a project is Rs. 43.02 per sq. which is quite
substantial and higher than rate of other finishing item such as plaster, POP and colouring etc.

Improvement or suggestion in conventional method to reduce this expenditure

Suggestion 1: If only one person is appointed as watchman and not allowing him to have his family
at the site. The likely expenditure shall be detail.

       The salary paid to watchman on most of the sites can observed is Rs.3000 to 4000 per as
such an average & Rs. 3500 taken into consideration. In India in general the cost of electricity
power consumption is Rs.6/-- unit of a water tanker of a capacity of approx 5000 liter cost Rs.200 to
500/- per tanker varying from place to place. In this study we have taken at as Rs.250/-.
Consideration of statics by using avability of data through survey:
     1)   Average area of construction          : 1846 Sq. ft
     2)   Average electrical consumption        : 7 units/ month
     3)   Average water consumption             : 100 lit/person/day
     4)   Average payment                       : Rs. 3500/-
     5)   Average construction duration         : 18 Months.


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Volume 4, Issue 4, July-August (2013)

As per above available data average expenditure per site is;

   i) Average electrical expenditure           :7X6            = Rs. 42/-
   ii) Average Water Consumption               : 100 X0.05     = Rs. 5/-
                                                               = Rs. 150/- per month
   iii) Average Payment                                        = Rs.3500/-

So; average expenditure as per each site                       = Rs. 3692/- per month

Average expenditure per sq.ft                     = 3692/ 1846 = Rs. 2.00 per sq. Ft. / month

Overall cost add up to completion of project     = Rs. 36.00 per sq. Ft. / Project -------- (b)

By applying this simple solution we will save           = (a) – (b)
(By Applying this simple solution of providing          = 43.02-36.00
 only one watchman on site)                             = Rs. 7.02 per sq. Ft./ project

     In our case study average area of construction per project is 1846 Sq.ft that’s mean we will save
near about Rs. 12,958.92 per project. (Say Rs. 13000/- per project)
     As such it can be seen that by adopting these technique there is a net salary of Rs.12624 per or
each every site. Thereby reducing cost of project by app 2% to 3 % which is always a good
amount.
        Following step is proposed to solve the indirect cost problem by compressing a project
execution time through utilization of last planner system for compressing bar chart diagram and
design realistic base plan to measure a performance and reducing an indirect cost burden.

Implementation Strategy

       This case study proposes a way of implementing lean and six sigma methodology
construction on complex and make building as a fast track projects for reducing indirect cost burden.
The first step is to stabilize the work environment by defending direct construction of each
component function from upstream variation and uncertainty management has not been able to
prevent. Once that shield is installed, it becomes possible to move upstream in front of the shield to
reduce inflow variation, and to move downstream behind the shield to improve performance

Traditional Planning

        The construction industry devotes tremendous efforts and resources to planning projects and
developing the schedules, budgets and other requirements that collectively tell project personnel
what they SHOULD do. Project management thereafter monitors and enforces conformance of DID
to SHOULD. Planning at the beginning of the project is replaced by control during project
Execution.
Everything works fine until some activity not get executed as per time schedule, then a chain
reaction takes place. A vendor fails to supply a specified material at time, causing non availability of
material on site, leading to a delay in construction, and late completion of a project Or, it will
increase a indirect cost burden in budgeted finance such as watchmen payment, electricity charges,
some hire equipment, inflated material cost, loss of rent, interest amount on raise finance etc. As
slack disappears from the schedule, more and more pressure is put on everyone in the chain to
produce more, faster. This usually makes things worse rather than better. Working hand to mouth

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Volume 4, Issue 4, July-August (2013)

and betting on the come results in ever more non-productive time, demoralizes supervision, and
directs energy and attention toward getting stuff to work with rather than how to do work as per
standard and specifications
        If this traditional approach to planning worked perfectly, DID would always match
SHOULD. Indeed, a major contractor’s project management policy includes the following statement:
"The project management team is responsible for finding methods of meeting the control budgets and
schedule rather than justifications for not meeting them."
       This tells project management that there are no legitimate reasons for failing to meet control
budgets and schedule. The result is failure to identify and act on reasons why planned work does not
get done, and failure to learn and improve. It is assumed that all work and resources can be
coordinated by schedules, and those inabilities to perform to schedule are rare or evidence of lack of
commitment.
Measuring Match of "Did" with "Should"
        Actual measurement reveals that what actually gets done differs from what is supposed to be
done roughly 1/3 of the time. The data shown in bar chart diagram are from one of many studies. On
construction projects, scheduled activities amounted near about 700 during the study period, of
which 252 activities were not completed as scheduled. The percentage of planned activities
completed was 64%; i.e. the percentage of planned activities not completed was 36%. This kind of
data suggests that the lack of fit between what we SHOULD do and what we CAN do is substantial
and systemic, and that we must learn how to manage in such conditions. Returning to the chart, note
that almost 80% of the misses were due to lack of materials and drawings; i.e. resources provided to
the construction phase by design or suppliers. Relying on schedules to coordinate work flow through
the process does not have a good track record.

Measuring System and Improving Performance

         The second level to be added to the planning system is devoted to adjusting SHOULD to
better match CAN and WILL. As explained earlier, we focus measurement on results and compare
actual to desired results to see if we are on track to achieve project objectives. This results-oriented
control is intended to disclose problems so they can be solved, thus keeping the project on track. In
fact, this approach to control is too abstract to identify what needs to be changed in order to improve.
 To determine where to get involved, it is necessary to focus measurement and control on system
components or levels. In the case of planning systems, that means measuring the match between
output and directives at each level and understanding the root causes of mismatches. The match of
WILL and DID is measured by Percent Plan Complete. The match of ADJUSTED SHOULD and
WILL can also be measured and improved, as can the match of SHOULD and ADJUSTED
SHOULD.

Quality Characteristics of Weekly Work Plans

        In practical assignments, there are two other primary quality characteristics of the
commitment level of planning, which will expressed here as "weekly work plans" the right
sequence of work is to be selected; i.e. work in the sequence that best moves the project towards its
objectives and complete a project within stipulated time and cost. Sequencing decisions can also be
made by last planners based on working.


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Volume 4, Issue 4, July-August (2013)

Benefits of Stabilizing the Work Environment

        An indication of the benefits to be achieved by stabilizing work flow is shown on bar chart
diagram no 1. Due to implementation of last planner we are able to reduced construction time from
76 week to 51 week which is shown on bar chart no 2. It leads to decrease indirect cost burden on
site. This is shown below through the calculation.

Measuring System and Improving Performance

         The second level to be added to the planning system is devoted to adjusting SHOULD to
better match CAN and WILL. As explained earlier, we focus measurement on results and compare
actual to desired results to see if we are on track to achieve project objectives. This results-oriented
control is intended to disclose problems so they can be solved, thus keeping the project on track. In
fact, this approach to control is too abstract to identify what needs to be changed in order to improve.
 To determine where to get involved, it is necessary to focus measurement and control on system
components or levels. In the case of planning systems, that means measuring the match between
output and directives at each level and understanding the root causes of mismatches. The match of
WILL and DID is measured by Percent Plan Complete. The match of ADJUSTED SHOULD and
WILL can also be measured and improved, as can the match of SHOULD and ADJUSTED
SHOULD.
Suggestion 2: With reference compressed activity bar chart and suggestion one. We considered that
one watchman deploys on each site and project should be complete in 12 months.
Consideration of statics by using avability of data through survey:

a)   Average area of construction   : 1846 Sq. Ft. (Say 1850 Sq. Ft.)
b)   Average electrical consumption : 7 units / month
c)   Average water consumption              : 100 lit./day/person
d)   Average payment                        : Rs. 3500/- per month
e)   Average construction duration          : 12 Months.
                                    (According bar chart no.1 & 2 after implementation of
                                    modified last planner system)

As per above available data average expenditure per site is;

     i) Average electrical expenditure         :7X6         = Rs. 42/-
     ii) Average Water Consumption             : 100 X 0.05 = Rs. 5/-
                                                            = Rs. 150 / month
     iii) Average Payment                                   = Rs.3500/-

So; average expenditure as per each site            = Rs. 3697/- per month (Indirect Cost)
Average expenditure per sq.ft = 3728/ 1846          = Rs. 2.00 per sq.ft. / month
Overall cost add up to completion of project        = Rs 24.00 per sq.Ft. / Project
According to equation a) our total saving is        = 43.02 - 24.00
                                                     = Rs 19.02 per sq. Ft./ Project
Total saving in project                              = 1846 X 18.9 = Rs 35,110.92/- Say 35,111/-

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Volume 4, Issue 4, July-August (2013)

CONCLUSION

        This case study shows that watchmen/security guard appointment at construction site which
reduces cost burden on project cost flow, by implementing lean and six sigma philosophy principles
through last planner system. Client can save substantial amount and execute a project within
stipulated cost if one watchmen/security guard appointment at construction site and the duration for
execute a project if reduced from 18 months to 12 months.

Learning

Learning for future projects includes:
   • Incorporate production control requirements into all team members for reducing the cost
       burden on cash flow
   • Involve owner, architect and engineer in cost control process
   • Use team planning technique for reducing planning schedule to actual schedule
   • Incorporate reason identification analysis and corrective action into weekly planning




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Volume 4, Issue 4, July-August (2013)




REFERENCES

1. Thomas H.R. and Sanvido, V.E.2000.”The role of the fabricator in labor productivity
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2. Thomas H.R. and Sanvido, V.Eand sanders S.R. (1989).”Impact of material management on
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3. Thomas H.R. Horman M.D.,de Souza U,and Zaviki,I (2002b) “Reducing variability to improve
   performance as a lean construction principle” J.constr.Eng.Manage.128(2),144-154
4. Thomas H.R.,Riley D.R.and JohnMessener (2005)”fundamental principle of site material
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5. Dr Z Mallick, Mr Shahzad Ahmad and Lalit Singh Bisht, “Barriers and Enablers in
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6. B.P. Mahesh, Dr. M.S. Prabhuswamy and Mamatha. M, “Improvement of Quality Awareness
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