Construction Project
Management
Unit 6: Site and MATERIAL MANAGEMENT
4.1 Construction site plan
Introduction
Construction site planning (CSP)
Construction site planning (CSP) is one of the
important aspects to be considered by a project
engineer or supervisor. CSP helps in effective
and efficient execution of construction work and
also helps in minimising the chances of astages,
deteriorations and losses, minimising the chance
of accidents in construction site.
Factors affecting construction site
planning
Nature and type of the work:
Site condition:
Method of execution:
Factors to be considered in construction site
planning
• Access to the site:
• Storage of materials:
• Plants:
• Temporary buildings:
• Miscellaneous:
4.2 Site Engineer/ Supervisor’s responsibility
Duties and Responsibilities of a Site Supervisor
Following are the principle duties and responsibilities of a site supervisor:
i. Understand duties and responsibilities of his/her own position.
ii. Plan the execution of the work.
iii. Divide the work among the workers & to direct and assist them doing it.
iv. Improve work methods and procedures.
v. Improve his own knowledge as technical expert and leader.
vi. Train the sub-ordinates.
vii. Evaluate performance of the employees.
viii. Correct mistakes, solve problems of employees and develop discipline among them.
ix. Keep sub-ordinates informed about policies and procedures of the organisation.
x. Deal with employees’ suggestions and complaints.
xi. Responsible for the information gap between the superior and sub-ordinates.
xii. Responsible for quality control and assure works according to design, drawing and
specification.
xiii. Responsible for keeping cost well within the specified budget.
xiv. Also responsible for site layout, site survey, day-to-
day supervision, preparing/checking bills, dealing with other parties and issues raised in
the site.
Supervising work of a contractor
Any site supervisor deputed at the site should thoroughly supervise
the work of a contractor.
-In order to ensure the use of quality materials, good workmanships
and quality of work; all the works shall be done in the presence of
site supervisor and only in the confidence of site supervisor further
works shall be carried out.
- If needed for checking the work done, excavation, drilling,
laboratory test or other appropriate procedure shall be followed.
-A great care and effective supervision is necessary until the whole
work is completed.
Record Keeping (site order book, measurement book)
Site Order Book: Site order book shall be maintained at site, because senior
officials frequently visit the site where they make some decisions or give some
instructions.
Procedure to prepare a bill
1. Running Bills
2. Final Bill
3. Measurement Book
Standard Measurement Book (SMB)
Standard Measurement Book facilitates preparation of estimate for
periodical repairs and making payment for such executed works.
Muster Roll
It is maintained to keep proper record of the labours employed daily for
executing
works.
4.4 Billing Procedure
• The billing procedure for a construction
project typically involves a pre-project contract
agreement, ongoing progress tracking, and
monthly or milestone-based invoicing. The
process includes generating a detailed invoice
with project information and costs, submitting it
to the client, and following up on payment
collection. Common methods for billing
include lump sum, progress billing, time and
material, and unit price, with the contract
determining which method is used.
Pre-project
• Finalize the contract: Agree on the project scope,
timeline, and most importantly, the payment
structure. Common methods include:
– Lump Sum: A single, fixed price for the entire project.
– Progress Billing: Payments tied to specific project
milestones or a percentage of work completed.
– Time and Material (T&M): Billing based on the actual
hours and materials used.
– Unit Price: Charging a fixed rate for each unit of work
completed (e.g., per square foot of paving).
• Set up project budget: Create a detailed budget
that aligns with the contract's payment terms.
During the project
• Track progress and document everything: Keep detailed records of
all work completed, including daily logs of labor hours, materials
used, and subcontractor activities.
• Submit and track change orders: Formally document and get
approval for any changes to the original scope, which will affect the
final billing amount.
• Creating and submitting invoices
• Generate the invoice: Once a billing period ends (often monthly),
create a detailed invoice. The invoice should include :Header
information (company and client details)Invoice number and date
Project description. A detailed breakdown of all charges (labor,
materials, equipment, etc.)Total amount due. Payment terms and
instructions
• Include supporting documentation: Attach any necessary
documents to support the invoice amounts, such as lien waivers or
a schedule of values.
• Submit the invoice: Send the invoice to the client according to the
schedule agreed upon in the contract.
After submitting the invoice
• Collect payment: Follow up on payment based on
the agreed-upon terms.
• Address discrepancies: Promptly resolve any
disagreements or questions the client may have
about the invoice.
• Reconcile and report: Keep meticulous records of
all submitted invoices and payments
received. This is crucial for financial management
and reporting.
• Final payment: Once the project is complete and
all conditions are met, process the final payment
and close out the project.
4.5 Essentials of material management
(planning, purchasing, storage, and disposal)
Purchase Management
Purchase the materials and have the services from supplier to
get the support of operation as the construction project from
production to marketing sales and logistics.
Purchase Management Contain
• Material indent
• Inquiry to vendor
• Vendor comparison
• Vendor selection and negotiation
• Purchase order
• Vendor evaluation
Construction Garbage and Surplus
Material
• Stock control technique to ensure all material
from vendor are set as per required
specification and quantity.
• As the management done sometime
insufficient arise on material said surplus
material.
• But excess material and wastage are
construction garbage of the project
4.6 Inventory Control and ABC Classification
Introduction
• It is defined as a function that integrates
purchasing, storage, inventory control,
material handling, standardization etc. in an
organisation to achieve its objective of
reducing the costs.
Functions of Material Management
-Material planning and control
-Purchasing
-Inventory control
-Store keeping
-Material handling
-Warehousing
-Standardization and simplification
-Organisation and appraisal of materials
Importance of Material Management
• Proper cost effective material procurement
• Proper storage of materials so as to minimise wastage
and material holdups
• Making available the material timely
• Identifying new or better source of supply
• Creating a standardize quality of the products
• Counting of supply by maintaining uniform flow of
materials
• Reducing the costs of materials purchased and
handling by using scientific techniques and electronic
tools
• Performing effective inventory control
• Providing high quality products at the lowest price
• Developing of better relationship with customers and
suppliers
Inventory Management
• replenishment lead time
• carrying cost of inventory
• asset management
• inventory forecasting
• physical inventory
• inventory valuation
• inventory visibility
• future inventory price forecasting
• available physical space for inventory
• quality management
• returns
• defective goods and demand forecasting
ABC Inventory Control Techniques
Class % of Item Monitoring
Class A Item 10-20% Highly important
cost of material is
high, low in quantity
Class B Item 50-60% Moderately
important cost and
quantity moderate
Class C Item 50-60% Low important, cost
is low, quantity is
high
Material Management Numerical ABC
analysis
Problem 1 From following information carryout
ABC analysis.
S.N Item Units Quantity Rate
1 E/W all complete Cum 1520 800
2 Back Filling all Cum 311 510
complete
3 Dry stone solling Cum 20 3100
all complete
4 1:4 Stone masonry Cum 69 12400
wall
S.N Item Units Quantity Rate Amount % of Item
1 E/W all complete Cum 1520 800 1216000 53.04924
2 Back Filling all complete Cum 311 510 158610 6.919523
3 Dry stone solling all complete Cum 20 3100 62000 2.704813
4 1:4 Stone masonry wall Cum 69 12400 855600 37.32642
Total 1920 2292210 100
% of
S.N Item % Quantity Monitoring Remarks
Item
Close
1 E/W all complete 10 53.049 Class A
Control
Regular
2 Back Filling all complete 40 6.919 Class B
Review
Infrequent
3 Dry stone solling all complete 40 2.704 Class C
Review
Close
4 1:4 Stone masonry wall 10 37.3264 Control Class A
Problem 2
Suppose you want to conduct an ABC analysis for your business. In that case, you should collect
the data on each item’s annual demand (amount of times it was purchased throughout the year)
and the item costs.
Item Value = demands x cost
Total inventory value = sum of all Item Values
Calculate the percentage of each inventory value = item value / total inventory
value x 100%
Here is a step by step example of such calculation:
Item Inventory
Item Annual Demand Item Cost (S) Annual Value Value
Percentage (%)
Iten A 3000.00 50.00 1500000.00 61.54
Item B 4000.00 12.00 48000.00 1.97
Item C 1500.00 15.00 67500.00 2.77
Item D 6000.00 10.00 60000.00 2.46
Item E 1000.00 20.00 20000.00 0.82
Item F 500.00 500.00 250000.00 10.26
Item G 300.00 1500.00 450000.00 18.46
Item H 600.00 20.00 12000.00 0.49
Item I 1750.00 10.00 17500.00 0.72
Item J 2500.00 5.00 12500.00 0.51
Total 2437500.00 100.00
You need to classify items into segments. For this, you need to line all items or products
from least to most value of item inventory percentage. In the above example, we see
that Item G has generated the most profit for that year, so it is a Class A product. When
the company has the percentages of each item, it is up to the company to decide their
classification standards.
It is crucial to understand that while some businesses use this analytics method, others
have a much more thorough and complex calculation method due to their broad
segmentation and size.
Final Thoughts
Though some aspects might be neglected using this method, ABC analysis is still a valid
way to decrease any obstacles you might face throughout the inventory management
process. It is a great tool to measure and control your pricing and improve your
customer service.
4.7 Value Engineering in Material
Management
• Value engineering in material management is a
systematic process of analyzing materials and
functions to reduce costs and improve efficiency
without sacrificing performance or quality. It
involves a structured approach to identifying less
expensive alternatives or more effective
methods, ensuring that the final product provides
the same or better function at a lower cost. The
core concept is optimizing the value, which is the
ratio of function to cost, by either improving
function or reducing cost.
Key principles and applications
• Function-cost analysis: The process begins by identifying the
functions of a product or component and analyzing its associated
costs.
• Creative brainstorming: Teams brainstorm alternative materials,
methods, and designs that can perform the same function.
• Evaluation and selection: Each alternative is evaluated for its cost,
performance, and potential impact on quality and function.
• Maintaining quality: A crucial principle is that cost reduction should
not compromise the essential functions or quality of the product.
• Material substitution: A primary application is finding less
expensive substitute materials that meet or exceed the original
specifications.
• Waste reduction: Value engineering can also identify opportunities
to reduce waste in material usage and processes.
The value engineering process
• Information gathering: Collect all necessary project and
material information.
• Function analysis: Define the functions of the product
using a verb-noun combination.
• Brainstorming: Generate creative ideas for alternatives.
• Evaluation: Analyze the pros and cons of each idea to
determine feasibility.
• Developing plans: Create detailed plans for the selected
alternatives.
• Presentation: Present the proposed changes to
stakeholders for approval.
• Implementation: Implement the approved changes.
Thank You!