Critical analysis On Cost Management of Commercial Buildings by using Primavera Software

Critical analysis On Cost Management of Commercial Buildings by using Primavera Software

Samrudhi Kashid

PG Student Department of Civil Engineering, TKIET, Warananagar, Shivaji University, India

Prof. Sandeep. S. Chavan

Project Guide Department of Civil Engineering, TKIET, Warananagar, Shivaji University, India

Abstract – Project monitoring and control is that the method of collecting, recording, and reporting information concerning project performance. Project controlling uses the data from monitor activity to bring actual performance to planned performance. this study deals with the project monitoring process of Standard Design Factory, a four storeyed (G+9) factory building whose construction is current at Dubai. A comparison between the planned progress of construction work and actual progress is performed during this study using project management software Primavera P6. Despite well- established principles and policies of project monitoring the strategy itself won’t be efficiently accomplished in an exceedingly project, due to those practical problems existing or arising within the project Such an endeavor in realizing the sensible problems in implementation of project monitoring and control will contribute to proper recognition of the matter areas and fitting place the control process to rectify the deviations

Keywords- Cost management, primavera, G+9, commercial, time period.

1. INTRODUCTION

   Construction projects are considered to be the foremost important pillars of any society therefore it is necessary to concentrate to them and examine their constantly changing circumstances, the event projects sector is one all told the foremost vulnerable to changing circumstances because it’s directly related to changing social , Economic and cultural conditions ,and thus the development projects are supported three pillars : cost, quality and time, therefore the success of any project is based on these pillars. The project is taken under consideration successful if it constructed with the simplest quality, all-time low time and thus very cheap cost, hence, the success of the project is closely related to the worth estimate of the project. projects and construction projects particularly could even be subject to financial loss or economic

   failure because of inaccuracy within the calculation and estimation of the costs expected, when the implementation

   of the project could even be the 000 costs greater than the expected costs and then the loss of the project, must be understood and study the worth estimate which is an important part of project cost management, by studying

   and understanding the principles and proper steps of the concept of cost estimation management, which contains cost estimation, budget determination & control.

2. REVIEW OF LITERATURE

   1. Mahmoud Fadhel Idan: The estimate costs of management in construction projects were studied in this paper, which gave achieved understand well by applying a principal cost estimate management. the importance of this study comes from considered the Construction projects are one of the most exposed projects to increase realistic costs over expected cost, Because of the many unexpected changes that occur, which is one of the areas of knowledge of project management.

   2. Manlian Ronald: Project Cost Management is a professional capability and expertise in planning and controlling costs for a construction project as well as analyzing the potential of risks that potentially lead to swelling of construction costs. a/c to Cost management is a process of controlling expenses on construction projects in every stage from feasibility to handover and ensuring that the cost plan is still in place.

   3. Sandip Pawar: Project planning is part of project management, which relates to the use of schedule such as Gantt charts to plan and subsequently report progress within the project environment

   4. T. Subramani: Due to an increasingly competitive environment, construction companies are forced to be more efficient and achieve competitive operational advantage.

      Companies are always looking for improvements in equipment features, communication tools, efficient management techniques, and training human resources. Construction companies are also narrowing their focus, becoming specialists in certain types of construction projects. This specialization requires more focused project planning and controlling techniques that prove to be better for certain type of projects while providing specialized construction services. The benefits of effective planning, scheduling and control of construction projects are: reduced construction time, reduced cost overruns and the minimization of disputes.

   5. Vinayak: Primavera P6 is amazing software, which is used not just by planners, but also managers, engineers, schedulers, and anyone else involved in planning, management, reporting of a project. Primavera P6 has benefited every industry from aerospace to manufacturing, electronics to IT, Telecom to Civil, any more. Primavera is an amazing project management software tool which is not just used by project managers. Designed to make managing large or complex projects a piece of cake, Primavera is the ideal tool for anyone who is involved in planning, monitoring and reporting on the progress of any big task, development or venture. The project management software tool of choice in industries such as construction, engineering, aerospace, transport and security, as well as in many other industry sectors. Primavera allows for top level planning as well as being ideal for managing the intricate details. This enables project managers, planners, planning controllers and other associated professionals to have instant access to all the project information they require at the touch of a button

3. PROJECT DETAILS

   Project: 3B+G+9 Storey, 3 Star Hotel Building

   on Plot No. 3260889 Dubai, UAE

   Client: Pavilion Hotel Management Ltd.

   Consultant: LACASA Architectural & Engineering Consultants

   Contractor: GBH International Contract: 570 Days (including Mobilization) Amount:35,142,500.00 AED

   Indian rupees: 758728318.42Rs

   Start Date: 02 June 2018 (Intended)

   Finish Date: 23 December 2019

4. SCOPE OF WORK

   The Construction of 3B+G+9 Storey 3 Star Hotel Building, including all the Civil, Architectural, MEP works, Finishes and Contractor designed works such as Post Tension Slab construction etc.; as detailed in the Tender drawings and Tender specification of awarded scope & BOQ Items

   The total built-up area is around 68,824 Sq. ft. including basement floors.

   The scope of work for this Contract covers as per the specification of awarded scope, preparation of shop drawings, procurement, Construction completion and Commissioning of the building

   Prime Cost items will be selected by the Client and supplied to Contractor for the installation in line with Contractors Construction Schedule.

   Provisional Sums item will be nominated by the Client and directed to Contractor in line with Contractors Construction Schedule.

   Challenges in construction industry:

   • Cost Overrun:

     cost it’s the phenomenon within which the client has got to spend extra money for the completion of project than the originally estimated i.e., the project goes ver the budget.

   • Time Overrun:

     Schedule Overrun it’s the phenomenon during which the project gets delayed beyond its expected completion time thanks to certain difficulties i.e., longer is required to

     complete the project than initially planned. Before you start to format your paper, first write and save the content as a separate document. Keep your text and graphic files separate until after the text has been formatted and styled. don’t use hard tabs, and limit use of hard returns to just one return at the top of a paragraph. don’t add any quite pagination

     anywhere within the paper. don’t number text heads-the template will do this for you. sufficient time, cost of design phase, fraudulent prevention, bulk material purchase and by applying short term goals were marked as vital factors to be considered

   • Causes of Cost Overrun:

     Availability of raw materials, allocation of to beat cost contractor or designer originated category.. cost variation in owner originated project than the key factors are design changes, incorrect evaluation of projects time and price, risk and uncertainty related with projects, nonperformance of subcontractors, conflict between project parties, fluctuation of rates, low skilled manpower, financing and payment. unstable charge per unit proper training, complexity of works, lack of and knowledge of project manager, disagreement in contract documentation, lack of appropriate software, inflation of costs, contract and specification interpretation disagreement, dependency on imported materials, unpredictable atmospheric condition, projects fraud and corruption, weak regulation and control and unstable.

   • Causes of your time Overrun:

   Majority of infrastructure projects in India are littered with time overruns. These overruns vary from few months to as high as five or more years placing

   1. The project viability in danger.\ Delays in land acquisition and site handover is that the primary reason for time overruns in pre-execution phase Delays in land acquisition are driven by several factors.

   2. Regulatory approvals from several agencies resulting in delay in Construction.

   3. Poor program management leading to ineffective co- ordination with other projects and schedule delay Insufficient management of Project design/scope change is widely prevalent within the infrastructure sector availability of resources for infrastructure sector is restricted plans, specifications, etc. don’t seem to be received by the contractor in time.

   The main components of the building and the related build- up areasare summarized below:

5. COST MANAGEMENT BY PRIMAVERA

   Oracle Primavera P6 could also be a project, portfolio management that’s used for planning, managing and executing your project work. it’s designed to handle large and small projects in an exceedingly number of diverse industries, like construction, manufacturing, energy, and IT. Its been doing so for quite 30 years in projects across the globe. Primavera P6 can trace its origins to 1983 when it had been first established under the name Primavera Systems. within the following 15 years, it’d rapidly gain in popularity. By the late 90s, advancements in server technology drove the company to separate Primavera systems into two versions of the software: a desktop application (which is preferred by contractors, suppliers and manufacturing companies) and a web-based enterprise option.In 2008, Primavera Systems was bought out by Oracle, who then developed the tool into the version that’s used today Cash flow management and fund management in primavera Cash flow management Executives and project controls professionalsincluding those in costs and contractsmust be ready to reliably forecast final costs by taking under consideration actuals so far, changes, trends, and risks over time. Further complicating this is often the

   necessity to know the specified capital for the approaching months and years. to try and do so requires accurate, comprehensive reporting and analysis. The income management feature of Primavera Cost Controls is fully integrated with the business processes, cost sheets, schedules, and portfolio manager within Primavera Unifier. The income management feature automatically pulls project information and transaction data directly from sources like enterprise resource planning systems or supply chain management applications including Primavera P6. Getting data directly eliminates the errors and delays that arise from manual data entry.

   The intuitive interface of Primavera Cost Controls is flexible enough to handle virtually any custom or manual income curve, and also the full-color graphical display facilitates analysis by allowing easy comparison. Fund management. The funds management feature in Primavera Cost Controls provides unparalleled tracking, reporting, and assignment capabilities. As such, it can handle the most-complicated funding structuresright down to individual contracts and specific cost codes. Funding is automated using Primavera Unifiers robust business process workflow engine, or it may be performed manually. Users can even employ a mix of both manual and automatic processes to realize easy use and full control over how project funds are spent. The funds management feature also provides visibility into the balance, disposition, and standing of every funding sourcefrom high-level views of all sources to their use for every project and transaction along with a close audit trail and full reportability.

   The funds management capability is fully integrated with the price sheet, ensuring visibility of funding against project budgets, actual spend, and forecasted spend. With Primavera Cost Controls, you gain greater financial control, operational discipline, and reduced risk through a robust, easy-to-use solution for managing costs, cash flow, and funds.

   Primavera Cost Controls provides superior cost visibility and control of all cost aspects of your capital program. Track and manage budgets, commitments, spends, and forecasts. Automate all cost business transactions at the extent of detail appropriate for any project size, with roll-up across the enterprise. Included are complementary modules for scheduling, document management, phase gate control, reporting and more. Primavera Cost Controls is a component of the integrated Primavera Unifier offering.

   1. Schedule Statistics

   2. Construction Intermediate Key Dates

   3. Permits and NOCs

   4. Input Data

   5. Interface

      1. Time Management

         By using the calculative power of Primavera P6, a Project Manager can typically manage or protect the schedule more effectively than conventional methods:

         1. Through Resource Optimization: 2030 days.

         2. Through Logic Overlapping: 3050 days.

         3. Through Early Warning (SPI): Preventing a potential 45+ day overrun.

            In total, P6 provides the visibility to manage and mitigate roughly 60 to 90 days of potential delay across the lifecycle of a high-rise project that a manual bar chart would likely miss.

      2. Cost Management

      If we assume a Data Date where the project is exactly 50% through its duration, but only 45% of the physical work is complete, and the accounting department shows a total spend of 16,500,000 AED:

   6. Project Calendars

      1. Five days project calendar defined and assigned for authorities & consultant review / approval.

      2. Six Days Projec Calendar Defined and assigned for Execution Activities.

      3. Seven days project calendar defined and assigned for Procurement (Manufacturing andDispatch of Material)

   7. Critical Activities

   Critical Path for the project is passing through Substructure to Super Structure work to Finishing to Testing and Commissioning to Local Authority Inspection & Approval.

6. METHODOLOGY

   The following methodology will be adopted:

   1. Studying primavera software in detail.

   2. Selecting case study of commercial construction projects. 3.Analysing project data by primavera and finding facts.

   4.Comparing process with conventional one to find out results in terms of cost and time

   1. Planned Value (PV): 0.50 * 35,142,500 =17,571,250 AED

   2. Earned Value (EV): 0.45 * 35,142,500 = 15,814,125 AED

   3. Actual Cost (AC): 16,500,000 AED

   Calculations:

   1. Schedule Variance (SV): 15,814,125 – 17,571,250 = – 1,757,125 AED

   2. Cost Variance (CV): 15,814,125 – 16,500,000 = -685,875 AED

   3. CPI (Cost Performance Index): 15,814,125 / 16,500,000 = 0.96.

   4. SPI (Schedule Performance Index): 15,814,125 / 17,571,250

      = 0.90.

      The Time Saving Impact:

      • Conventional Timeline: 24 Months (730 days)

      • Current Project Timeline: 18.7Months(570 days)

      • Time Saving: 160 Days

        Financial Calculation of Time:

      • Daily Overhead Savings: If site preliminaries are 12,000 AED/day, saving 160 days saves the contractor

   1.92M AED in pure overhead.

   • Direct Structural Savings: You can prove the 10

     15% cost saving of PT slabs by comparing the Budgeted Total Cost of two different resource-loaded baselines.

   • Labor Efficiency: You can track if the 5.0 man- hours/m² target is being met in real-time, rather than waiting for the end of the month to see labor overruns.

   • Procurement Control: You can link Provisional Sum (PS) items to specific dates, ensuring specialized hotel equipment is only paid for when “Earned.

   RESULTS AND DISCUSSION

   Cost management is crucial to maintaining the financial integrity of any project, contract, or portfolio. Primavera Cost Controls includes best-in-class automation of all cost processes, including estimates, commitments, spends, variances, forecasts, and more. Constantly changing information is managed through Oracles Primavera Unifier workflow engine, where budget changes, contract changes, and risks are all tracked to make sure decisions are responsibly made with current data. Managing these elements is enabled through the merchandise interface or maybe directly from automated e-mails, increasing easy use. All costs roll up to a central cost sheet normalized by a strong cost code structure, where project cost information is offered for drilldown by work package or for the complete project. All cost structures are easily configurable by an administrator.

7. CONCLUSION

This study compared time performance of the standard method of construction for high- rise residential and Industrial Building System (IBS) method by formulate benchmark measures of industry norms for overall construction period using scheduling simulation modeling. The positive changes include creating a healthy working environment among those involved directly within the housing industry. Better Efficiency in Delivering Services: Project management provides a roadmap that’s easily followed and ends up in project completion. Once you recognize where to avoid the bumps and potholes, it stands to reason that youre visiting be working smarter and not harder and longer. Improved Customer Satisfaction Whenever you get a project done on time and under budget, the client walks away happy. And a contented client is one youll see again. Smart project management provides the tools that enable this client/manager relationship to continue. Enhanced Effectiveness in Delivering Services the identical strategies that allowed you to

successfully complete one project will serve you a great many times over and also Reduced risk and price of schedule overrun. It helps easily plan and manage project activities, it optimizes management of all resources, it gives clear visibility of whats occurring within the project, It allows quick and simple forecasting of WBSs, activities or projects.

REFERENCES

1. Mahmoud Fadhel Idan Estimate cost management in construction project (2019) International Journal of Applied Engineering Research ISSUE- 2019

2. Manlian Ronald (July 2018) Analysis of project cost management and the effects of cost overrunin construction project. International Journal of Innovative Research in Science, Engineering and Technology Issue- July 2018

3. Sandip Pawar Time and cost planning in construction project (2013) International Journal of Innovative Research in Science, Engineering and Technology ISSUE APRIL 2013

4. T. Subramani (2014)”Planning and Scheduling of High- Rise Building Using Primavera International Journal of Science and Research (IJSR) Issue: June 2014

5. Vinayak (2015) “Construction Management and Scheduling Of Residential Building Using Primavera” International Journal of Science and Research (IJSR)