DR SHAIFUL AMRI MANSUR

FKA UTM

Machinery & Material

Management

TOPIC OUTLINES 4

1 2
Overview & Machinery
Planning of Related
Machinery Problem
6 7 3
Material Summary Machinery
Cost Acquisition

5 4
Quality & Overview of
Wastage Material
Control Management

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DR SHAIFUL AMRI MANSUR
FKA UTM

Overview & Planning of Machinery 5

Introduction of Machinery Management

• Directly related to project:
1. Manpower/Labour
2. Machinery/Equipment
3. Material

• Machinery cost may varies

about 20% to 40% of
total construction cost
Among important
project resources to • Majority of infrastructure
be managed works are extensively
using machineries

Overview & Planning of Machinery Cont. 6

Types of Cost
1 2 3
Direct Cost Indirect Cost Total Cost

≈90% + ≈10% = 100%

+
4
Profit
$ Job Price
=
4

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DR SHAIFUL AMRI MANSUR
FKA UTM

Overview & Planning of Machinery Cont. 7

Planning of Machinery
• Proper planning is required due to substantial cost
involved, help to reduce or avoid potential problem

• Planning and scheduling of machineries must be

indicated on the work program/schedule

• Requisition on acquiring must be made to use a

particular machinery

• Apply resource smoothing or levelling when

necessary

TOPIC OUTLINES 8

1 2
Overview & Machinery
Planning of Related
Machinery Problem
6 7 3
Material Summary Machinery
Cost Acquisition

5 4
Quality & Overview of
Wastage Material
Control Management

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DR SHAIFUL AMRI MANSUR
FKA UTM

Machinery Related Problem 9

Potential Problem
• Despite proper planning of machinery, several
problems may be faced by the contractor as
construction progresses

• The important thing to do is to acquire the required

machine for specific works especially for critical
activities

Machinery Related Problem Cont. 10

Types of Machinery Problem

Breakdown – Over usage,
01 no maintenance
Unavailability – Market
02 unavailability, no requisition
Loss or Stolen – No security, no
03 hoarding at construction site
Inefficient – Uneconomic age, under
04 capacity, unskilled operations
Shortage – Unplanned machinery use,
05 concurrent activities of the same machinery

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DR SHAIFUL AMRI MANSUR
FKA UTM

TOPIC OUTLINES 12

1 2
Overview & Machinery
Planning of Related
Machinery Problem
6 7 3
Material Summary Machinery
Cost Acquisition

5 4
Quality & Overview of
Wastage Material
Control Management

Machinery Acquisition 13

Overview
• Decision to acquire machinery must be seriously
considered due to high capital requirement

• Cost of machinery can be in the range of several

hundred thousand to million Ringgit

• Decision to purchase and own machinery need to

consider associated costs such as maintenance, rental
and other related cost

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DR SHAIFUL AMRI MANSUR
FKA UTM

Machinery Acquisition Cont. 14

Acquisition Option

Machinery
Acquisition

Purchase/Own Lease Rental

Own Not to Own

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Machinery Acquisition Cont. 15

Consideration Factor (Purchase/Own)

Cost Capacity Demand

Own money or Output or Up to date

bank loan productivity machinery
Associated cost: Skilled For continuous
maintenance operator project/rental

Life Span Usage Brand

Optimum age Multiple Resale value

to be replaced usage/reuse Available spare
or sold E.g modification parts and
Work efficiency of crane use mechanics

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DR SHAIFUL AMRI MANSUR
FKA UTM

Machinery Acquisition Cont. 16

Cost of Acquiring Machineries

Capital Cost Operating Cost

- Purchasing - Running Cost
Cost/Instalment - Operator Cost
- Interest (Bank Loan) - Maintenance
- Insurance - Fuel
- Depreciation - Spare part
(Resale value) (Breakdown)

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TOPIC OUTLINES 17

1 2
Overview & Machinery
Planning of Related
Machinery Problem
6 7 3
Material Summary Machinery
Cost Acquisition

5 4
Quality & Overview of
Wastage Material
Control Management

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DR SHAIFUL AMRI MANSUR
FKA UTM

Overview of Material Management 18

Introduction
• Directly related to project:
1. Manpower
2. Machinery
3. Material

• Similarly, material cost

Proper material
varies about 20% to 40%
management is vital
of total construction cost
to ensure
on time and on budget
• Quality and wastage
project progress
controls are also important

15

Overview of Material Management Cont. 19

What to Achieve?
• Level of project performance is measure by the
achievement in the objectives of the projects
Increase durability
1
Make more profit
Cost 2
Quality 3
Wastage
Reduce money

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DR SHAIFUL AMRI MANSUR
FKA UTM

TOPIC OUTLINES 20

1 2
Overview & Machinery
Planning of Related
Machinery Problem
6 7 3
Material Summary Machinery
Cost Acquisition

5 4
Quality & Overview of
Wastage Material
Control Management

17

Quality & Wastage Control 21

Quality of Material
• A set of specified standard or specification that
usually stated in the contract documents
- It is very essential for quality control

• Each construction materials to be used for a specific

project will be specified in terms of its quality
- E.g Concrete: measured by the slump (workability)
and strength

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DR SHAIFUL AMRI MANSUR
FKA UTM

Quality & Wastage Control Cont. 22

Quality Control
• Purpose: to ensure that the required materials in
compliance with the specific standard

• Example of non-compliance: Slump of concrete

- Poor workability, more void within the concrete
which reduce the concrete strength
- Any non-compliance must be rejected which involve
more cost
- May lead to potential problem of unstable
structure

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Quality & Wastage Control Cont. 23

Quality Management
• Managing quality should focus at reducing or
avoiding the occurrence of non-compliance

• It is better to manage the process of compliance

rather than managing the outcome

• Quality Management System

1. Policy
2. Procedure
3. Monitoring
4. Controlling

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DR SHAIFUL AMRI MANSUR
FKA UTM

Quality & Wastage Control Cont. 24

Quality Management System of Material

Acquire Approval by Place Supply to site with
material SO/ person order for prior inspection
(e.g bricks) in-charge material before unloading

Check verticality and Use, place or construct in

alignment or other accordance to drawing
conformance standard or specification

Completed
Approved

Rejected

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Quality & Wastage Control Cont. 25

Material Wastage
• Wastage on construction sites can be in between the
range of 3% to 10% of total material usage
- Happen all around the world

• On average of 10% as reported in Malaysia, the

wastage cost is quite high

• Malaysian construction industry spends more than

RM100 billion in project development yearly
• 10% of RM100 billion = RM3 billion wastage

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DR SHAIFUL AMRI MANSUR
FKA UTM

Quality & Wastage Control Cont. 26

Cause of Material Wastage

• Cutting and Handling
- Double or more handling
- Improper handling (unloading and usage)
- No proper planning for cutting and handling
(e.g steel and formwork)

• Requisition
- Extra order quantity (e.g concrete)
- Wrong order
- Loose material or low quality

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Quality & Wastage Control Cont. 27

Cause of Material Wastage – Cont.

• Inadequate Shelter or Storage
- Loss or stolen material

• Inexperienced Worker
- Poor workmanship and quality

• Weather
- Flooding
- Decay or spoil of material (e.g cement)
- Long exposure may cause rusty (e.g steel)
- Diminish or reduce the material volume (e.g soil)

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DR SHAIFUL AMRI MANSUR
FKA UTM

TOPIC OUTLINES 28

1 2
Overview & Machinery
Planning of Related
Machinery Problem
6 7 3
Material Summary Machinery
Cost Acquisition

5 4
Quality & Overview of
Wastage Material
Control Management

25

Material Cost 29

Overview
• 20% to 40% of total construction cost

• Appropriate monitoring and controlling system on

materials will indirectly help to:
- reduce the impact of wastages to the construction
industry
- optimize expenditure on material cost

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DR SHAIFUL AMRI MANSUR
FKA UTM

Material Cost Cont. 30

Effect of Wastage on Material Cost

Contract Value Client’s Liability

3
Total Cost Contractor’s
Liability
+
4
Profit
(Contractor’s Mark Up) High Wastage Lower Profit

27

Material Management 29

Overview
• Process for planning, executing and
controlling activities in construction
• The goal is to ensure that construction
materials are available in a timely
manner

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DR SHAIFUL AMRI MANSUR
FKA UTM

Material Management 29

Overview
• Efficient management of materials can
result in substantial savings in project costs
• If materials are purchased too early,
interest charges may incur on the excess
inventory of materials, materials may
deteriorate during storage or get stolen

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Material Management 29

Objectives
• Efficient materials planning
• Buying or Purchasing
• Procuring and receiving
• Storing and inventory control
• Supply and distribution of materials
• Quality assurance
• Good supplier and customer relationship
• Improved departmental efficiency

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DR SHAIFUL AMRI MANSUR
FKA UTM

Material Management 29

Components:
• Material estimation, budgeting, planning and
programming
• Scheduling, purchasing and procurement
• Receiving and inspection
• Inventory control, storage and warehousing
• Material handling and transport
• Waste management

31

Purchasing Procedure 29

Generate Enquire
indent vendor

Compare Select vendor

vendor & negotiate

Purchase Evaluate
order vendor

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DR SHAIFUL AMRI MANSUR
FKA UTM

Receiving & Inspection 29

System receipts:
• Receipt from outside suppliers
• Receipts from internal divisions.
• System of receipt starts even before the
material reaches the site
• Documents that should be dispatched are copy
of purchase order, supplier’s advice document
and the consignment note.

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Receiving & Inspection 29

Inspection:
1. Pre-dispatch inspection
2. Inspection on site
Inspector to inspect all materials delivered to the site
prior to their use in the work; and to perform
inspection of materials or fabricated products prior
to their delivery at site.

Methods of inspection: 1.Visual 2.Tactile 3.Statistical

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DR SHAIFUL AMRI MANSUR
FKA UTM

Stacking & Storage 29

Specifications:
1. The materials should not be affected by impurities or
atmospheric agencies
2. Materials like cement should must be stored in covered
sheds and stacked on timber raised platforms.
3. Reinforcing bars should be stacked yards away from
moisture to prevent rusting and also away from oil and
lubricants. Bars of different classification, sizes and lengths
should be stored separately to facilitate issues.

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• To remove or reduce on-site construction waste

Off-site • To help improve quality, safety, cost and scheduling of

materials
prefabrication
• To use purchased product instead of field-assembled

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DR SHAIFUL AMRI MANSUR
FKA UTM

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FKA UTM

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DR SHAIFUL AMRI MANSUR
FKA UTM

TOPIC OUTLINES 31

1 2
Overview & Machinery
Planning of Related
Machinery Problem
6 7 3
Material Summary Machinery
Cost Acquisition

5 4
Quality & Overview of
Wastage Material
Control Management

41

Summary 32

Machinery Management
• Cost of machinery usage is quite significant

• Planning of machinery usage is essential to

ensure smooth project running

• Many machinery problems can hinder work progress

• There are three main machinery acquisition methods

• Several factors need to be considered for

machinery purchasing

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DR SHAIFUL AMRI MANSUR
FKA UTM

Summary Cont. 33

Material Management
• Project performance measurement related to
material management is based on cost and quality

• It is essential to have proper quality management

system for material management

• Waste control is another way to help in avoiding

project loss

• Appropriate waste prevention and control may

assist manager to have proper planning

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