Construction Equipment and Plant

Management
 Chapter One: Introduction
Resources and Construction
Processes
 The Major Resources in
Construction
Institutional (reputation, O. culture, O. capability,
management style & experience, etc)
 Need to be cultivated, nurtured and exploited to gain a
competitive edge
Finance (Money): the most liquid resource of a firm
 The major resource used to secure other resources
Human (capacity and capability):
 Is the resources that actually does the job
Physical (Material, Equipment & Plant):
 The major resources used to do the job
Information (Network) (Availability &access)
 As the saying goes “Information is power!”
 Time and space
 Managing the time and the space available for any action is
importance for its success
Construction processes and the
resources
Construction works entail an intricate interaction of these
resources and various processes to achieve the project
goals

Project requirements

Resources are limited to the extreme and

projects are constrained
Proper resource management and utilization
scheme is needed for success of projects
 Construction execution strategy
The focus of resources management in construction
works depends on the execution strategy adopted

Work by and
• Available ownunder
resource
utilized •Own
Workforce
by outsourcing:
is tied on other
own resources/expertise.
(Force accounts) jobs
• •Work can
Available beunder
and doneutilized
more own • •No
Ownavailable resource
force is tied or
on other jobs;
effectively (better, faster,
resources/expertise; • expertise
No available resource or
• more
Work economical)
can be done more by own expertise;
•Subcontractors do the job
force
effectively (better, faster, more • more
Subcontractors do the job more
effectively
•No available
economical) by sub-contractor
own force; effectively (specialized);
• toNotake
(specialized)
on the
available job
sub-contractor to • Etc
take on the
Mainly job;
a resource • Mainly a procurement &
• management
Etc issue
Mainly a procurement &
contract management issue
 Mainly a resource management contract management issue
issue
The Importance of Equipments in
Construction Works
 Equipments in Construction
• The involvement of equipments in construction works is
dependent of the level of mechanization needed/sought
• Low (labor Intensive) • High (Machine intensive)
• Used in light • Used in heavy
constructions constructions like
– Low rise buildings – High rise buildings
– Small structures in road – Road projects
constructions – Hydropower projects
– Small irrigation projects, – Mining projects
etc – Mechanized irrigations, etc
• Very useful in creating • Help achieve high quality
job opportunities efficient execution of
tasks
 Proportions of equipment costs in
Construction Works
Varies with:
 Level of mechanization of execution,
 Country of work (eg.Ethio = cheap labor),
 Project characteristics (deep fill/cut road),
 Etc
Generally: Building sector:
• Material cost ¡Ö 40% of project cost
• Labor cost ¡Ö 25-30%
• Equipment ¡Ö 5- 10%

Civil works construction:

• Equipment cost ¡Ö 40% of project cost
• Material cost ¡Ö
• Labor cost ¡Ö
 Equipment Proportion

Exercise! Calculating equipment cost proportion of a project

 Equipment Proportion in a
Project
Detailed break down of work item unit prices

Project : Labour hourly output :

Work Item : Clearing & Grubbing Equipment hourly output:
Total quantity of work item : Resultant : 0.160 Ha/hr

Material Cost Labor cost Equipment cost

Material Unit Qty Rate Cost/ Title Qty UF Indexed Total Equipment Qty UF Rental rate
Type unit hrly cost hrly cost type hrly Total
Dozer(200-250
Con.Foreman I 1 0.50 34.00 17.00 HP) 1 1 1252.00 1252.00

Dozer. Ope. IV 1 1 34.00 34.00

Helper III 1 1 14.40 14.40
Labourer I 2 1 4.17 8.34

Total 0.00 Total 73.74 Total 1252.00

B = Manpower C = Equipment
A = Material Unit Cost 0.00 Unit Cost : 460.88 Unit Cost : 7825

Direct cost of
work item
=A+B+C 8285.88
Assuming 15 % project overhead and 10 % profit margin , the total surcharge adopted is 25% of direct cost. Thus : 2000.00

Total cost on
rental basis = 10,357.34 Birr/Ha 2100.00
UF : Utilization Factor
 Equipment Proportion in a
Project
Item No Descreption Unit Quantity Rate Amount Equipment proportion
1 Clearing and grubbing Ha xxx yyy zzz www

Sum aaa bbb

Equip pro bbb/aaa

Multiply the Contribution of equipment costs by quantity of each item

Sum the Equipment Costs and divide it by project cost, you can get the
proportion!
Wastes in Equipment Utilization

Downtime & its consequences

Idleness of equipment
Idleness of crews
Work Disruption
Activity delay
Loss of productivity
Wastes in Equipment Utilization
• Repair cost/ cost of substitute
• Idle related resource cost (personnel and/or
equipment);
• Loss of productivity costs (disruption, new
learning, moral, etc);
• Contract related costs: Liquidated damage,
escalations due delay, disruption to the work of
other contractors (related to the job), etc;
• Other costs: extended overhead costs, extended
overtime, acceleration costs, etc.
• Etc
 Significance of efficient
equipment management
Equipment contribution in road construction
in Ethiopia
 Say 40% (very conservative estimate)
 Waste level by equipment (5%, say)

Save the 5 % waste, you will be saving 2% of

the project cost
Saving Birr 6 Million from a Birr 300 million
project isn’t that bad!
 Construction Equipment
Management
• Construction Equipment Management is the
processes of Planning, Utilization and
Monitoring of construction equipments to
arrive at:
– Selecting the appropriate machinery to the scope of work and other
constraints (time, cost, other resources, etc);
– Best alternatives of acquiring (accessing) the most efficient
resource and deploying it on site
– Once on site, achieve best productivity (reduce downtime, increase
working hours, improve life time, etc)
– Have best fleet and maintenance management schemes so that
machine’s downtime is reduced and resource usage is optimized;
– Harmonize, standardize and enhance quality of final output (or
construction processes)